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Last 10 days deadline! Twitter freezes employee equity incentive accounts, believing that Musk will buy
Twitter froze employees' equity-incentive accounts in what appeared to be a firm belief that Musk would complete the deal.
On October 18, local time, Bloomberg reported that less than 10 days before the completion of the acquisition transaction with Tesla CEO Elon Musk, social media Twitter announced that it would freeze employees’ equity incentive accounts. , an indication that Twitter wants to close the deal.
According to Bloomberg, Twitter updated its FAQ page for employees to remind employees that they will no longer be able to access accounts or trade stocks through the Equity Award Center. Schwab, the financial services firm that manages Twitter's stock, was allowed to make final reconciliations of employee accounts before the acquisition closed, the page shows.
Two people familiar with the matter said that Twitter’s change was based on expectations that “Musk is close to completing the acquisition.”
In early October, Musk re-proposed to close the deal at $54.20 per share, for a total value of about $44 billion. The judge then suspended the case and ordered both parties to complete the deal by 5 p.m. on October 28. Bloomberg said the freezing of employee equity incentive accounts indicates that Twitter is moving forward with the acquisition.
According to Bloomberg, Twitter employees have been anxiously waiting for the deal to close, with many worried about possible layoffs in the future. Some employees will receive restricted stock early next month, some plan to quit after receiving the stock, and they have already started looking for other job opportunities, people familiar with the matter said. On the anonymous chat software Blind, people have begun to share how to deal with layoffs.
Whether the acquisition can be completed depends on whether Musk can obtain debt financing. Seven banks including Morgan Stanley, Bank of America Corp. and Barclays agreed to give Musk about $13 billion after Musk announced his acquisition of Twitter in April. debt.
The debt includes $6.5 billion in leveraged loans, a $500 million revolving credit facility, $3 billion in secured bonds and $3 billion in unsecured bonds, according to the Wall Street Journal.
Musk's lawyer said, "So far, Musk has a good chance of getting financing, which means the acquisition can be completed around October 28."
Twitter lawyers have previously said that a representative of a bank company involved in the debt transaction has certified that Musk has not sent them a loan notice or otherwise indicated to them that he intends to complete the acquisition transaction.
As of the close of U.S. stocks on October 18, Twitter rose 2.05% to close at $51.78 per share.
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