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Insider reports reveal that Musk plans to revert Twitter to a public company sometime in the next few years.
Elon Musk says that he will return Twitter Inc (NYSE: TWTR) back to public ownership within three years. The Tesla Inc (NASDAQ: TSLA) CEO is slowly revealing general plans for the major social media platform, including first taking Twitter private.
According to Musk, he will stage an initial public offering of Twitter sometime in 2025/26 after first achieving his goal of transforming the company. For now, his immediate outright acquisition will close later this year, subject to conditions including regulator and shareholder approval. Musk’s plans to eventually restore Twitter to the public spotlight may be a catalyst in his quest for additional funding.
Musk Will First Make Twitter Private to Effect Desired Changes Before Taking It Public Again
Musk acquired Twitter with plans to take the company private in order to preserve and promote free speech. In his opinion, having total control of Twitter’s affairs and operations is important to creating a level playing field for right- and left-wing users. Musk tweeted his commitment to an equitable Twitter environment saying:
“I hope that even my worst critics remain on Twitter, because that is what free speech means.”
Musk has been in recent discussions with many investors, including high net worth individuals and private equity firms. The CEO is doing this to secure more financing and commit less of his own wealth to the buyout. Musk will not have to pay the entire $21 billion he intends to inject into the deal if he secures significant funding from these sources. The other $23 billion will come from loans issued by several financial institutions.
According to the Wall Street Journal, one of the investment management firms considering participation in the deal is Apollo Global Management.
Private equity firms frequently take companies off the market after acquiring them to fix them away from the public glare. Then, after five years or so, these firms usually return the ‘improved’ companies to the public. Musk’s suggestion for something similar with Twitter may be a potential bargaining chip with potential investors. The CEO might be trying to demonstrate that he wants to quickly improve the social media giant on all fronts. These improvements might eventually lead to more effective business operations as well as increased profitability.
Musk’s Twitter Improvement Plans Still Obscure
So far, Musk has provided little to no details on his exact plans for Twitter, besides his free speech mantra. In addition, the outspoken billionaire businessman is currently positioning his Twitter agenda as more altruistic than profit-oriented. In a recent interview, Musk said the deal is “not a way to make money,” and suggested that he does not care if he makes any profit from it. Although specific plans or timelines are unknown, Musk has a history of missing targets at Tesla.
Following the acquisition announcement at the end of last month, Tesla stock plunged. At the time, many investors were concerned that Musk would liquidate his stock to fund the purchase.