Takeover Soon? Twitter Freezes Employees' Stock Accounts In Anticipation Of Finalising Musk Deal

In what can be seen as a big sign towards the much awaited completion of Elon Musk-Twitter¡®s $44 billion deal, Twitter has frozen equity (stock)accounts for its employees. This comes barely 10 days ahead of the October 28th deadline for Elon Musk to close the deal, as per Bloomberg News.

The news report sent Twitter shares up around 2% yesterday to end at $51.78 on the NYSE, though this mark is still lower than Elon Musk's offer price of $54.2 per share.

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Tesla CEO Elon Musk and Twitter have been directed by the Delaware court to close the $44 billion deal by October 28, 2022. The deal was first announced about six months ago, in April.

Twitter expects the deal to close

According to the Bloomberg report, Twitter updated its employee FAQ page this week to alert staff they won't be able to access or trade shares from the Equity Award Center.

The FAQ page said the change was made "in anticipation of the closing of the pending acquisition of Twitter by an entity controlled by Elon Musk", according to the report, citing two people familiar with the change. This step is likely to prevent employees holding Twitter stocks from trading the shares ahead of the expected takeover.

In the first week of June, Twitter shares suffered around 5% fall when Elon Musk tried to walk away from the $44 billion deal, alleging Twitter understated the number of bot and spam accounts on the social media platform, which started a series of lawsuits between the two parties. Musk had threatened to cancel the deal over the fake account issue.

And earlier this month, the world¡¯s richest person, Musk, suddenly reversed the course of the deal and said he would proceed with the deal on its original terms, following which a judge halted the trial that was scheduled for this week.

Also Read: World's Richest Person Elon Musk Meets His Indian 'Twitter Friend' 23YO Pranay Pathole In Texas

Expensive Deal For Twitter Too

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While Elon Musk is busy with the task of ensuring that he is able to pay the mammoth amount of $44 billion for the deal and close it by the October 28th deadline, this deal has not been any less expensive for Twitter either. Upon revealing its April-June quarter¡¯s financial results in July, Twitter stated that costs related to the pending acquisition of Twitter were approximately $33 million.

So, between April and June 2022, Twitter spent $33 million (?27 million) on Tesla CEO Elon Musk's proposed deal to buy the firm. Given that the court proceedings and other tasks related to the deal have gone on post this period too, it's possible that the total cost incurred by Twitter might have been higher than this.

It remains to be seen whether Elon Musk's much-anticipated $44 billion Twitter takeover is completed on time by October 28th.

Also Read: Elon Musk Says Twitter Board's Salary Will Be $0 If His Takeover Bid Succeeds

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