Why does billionaire Elon Musk want to take Twitter private
Billionaire Elon Musk plans to make Twitter a private company following his $44 billion deal to buy the social media platform.
Twitter has been a publicly traded company since 2013, but it only has turned a profit twice -- in 2018 and 2019.
Musk has argued that in order for Twitter to be successful and serve the "social imperative" of free speech, it must be "transformed as a private company."
If Musk's planned deal to buy Twitter goes through, and he takes the company private, Twitter shareholders will receive $54.20 per share in cash.
That will put extra money in the pockets of most shareholders, said Matthew Faulkner, an assistant professor of finance at San Jose State University.
In order to go private, Twitter's board will negotiate a takeover deal with Musk and then host a special election for its investors to accept or decline the purchase.
Musk has hinted at adding an edit button to tweets, ending Twitter’s dependence on ads, and expanding freedom of speech.
Taking Twitter private also means the company would no longer need to report its financial documents or "material" developments to the SEC, the federal regulatory agency Musk has had legal troubles with in the past.
Those regularly filed reports, which can include risks to the company and any plans that could impact its financial performance, are public information that shareholders and anyone can view.