Twitter’s board of directors had reached the end of the road.

It was April 24th. Ten days earlier, Elon Musk, the richest man in the world, made one unsolicited offer to buy Twitter for $54.20 per share. Troubled by the out of the blue offer and unsure if the offer was genuine, the social media company had a “poison pill‘, a defensive maneuver to keep Mr. Musk from amassing more of his shares.

But this Sunday, Twitter ran out of choices. Mr. Musk had prepared the funding for his offer and was annoying the company with his tweets. And after hours of discussion and reviewing Twitter’s plans and finances, the questions the 11 board members wrestle with – could the company be worth more than $54.20 a share? Would another bidder show up? – all led to an unsatisfactory answer: no.

Less than 24 hours later, the blockbuster $44 billion Deal has been announced.

“What I will tell you is that based on analysis and perception of risk, safety and value, the board has unanimously determined that Elon’s offering represents the best value for our shareholders,” said Bret Taylor, Chairman of Twitter told the company more than 7,000 employees Monday in an appeal heard by the New York Times.

A key mystery of Mr. Musk’s takeover of Twitter is how the company’s board of directors went from installing a poison pill to agreeing to sell it to him in just 11 days. With most mega deals, accepting a poison pill leads to a drawn-out struggle. The tactic is a clear signal that a company wants to fight. The negotiations then drag on. Sometimes buyers walk away.

But interviews with a dozen people close to the transaction who were not authorized to speak publicly show how few options Twitter’s board had.

And while there are many types of buyers willing to fend off deal advisers — hostile, aggressive, those who hold off and then are willing to negotiate — in Mr. Musk, Twitter faced a buyer who was not in any deal- manual stood. Essentially, he was an acquirer of “magnitude unknown,” one who wouldn’t budge on the price and was willing to publicly ruin the company and use his considerable fortune to try to reach a settlement with limited diligence.

“Actual buyers might actually say, ‘Well, you know, we actually want to talk to the people inside and see how the deal is doing and get more data than is available to the public,'” said Edward Rock, a professor of corporate law Governance at the New York University School of Law. “What was interesting,” he said, was that the Twitter board “reached an agreement in such a short amount of time — and such an unconditional agreement.” He called the speed of the deal “unusual”.

Twitter declined to comment on its board discussions. Mr Musk did not respond to a request for comment.

The groundwork for a deal was laid in January when Mr Musk began buying and eventually building Twitter stock a stake of more than 9 percent in the company. When he announced his holdings in a securities filing in early April, Twitter offered him a seat on the board of directors. Mr. Musk previously briefly agreed to the idea change his mind.

Instead, on the evening of April 13, Mr. Musk texted Mr. Taylor, who has been Twitter’s chairman since 2016. (Mr. Taylor is also co-CEO of software company Salesforce.)

“I will send you an offer letter tonight, it will be public tomorrow morning,” Mr Musk wrote to Mr Taylor. The exchange was recorded in a securities filing.

A letter of offer from Mr. Musk arrived the next morning. It stated its intention to buy Twitter for $54.20 a share, but offered few details about its plans for the company or funding.

Mr. Musk hired the investment bank Morgan Stanley and used the services of two bankers, Anthony Armstrong and Michael Grimes. Mr. Grimes, who heads Morgan Stanley’s technology banking practice, led the 2012 IPO of Facebook and other tech companies, while Mr. Armstrong was a veteran tech banker who had recently been promoted to the firm’s vice chairman.

Twitter’s board is at a loss as to how to deal with Mr Musk’s offer, said people who were aware of the discussions. Mr. Musk didn’t have a track record of buying companies and hadn’t gone through with a few deals, including one in 2018 when he tweeted that he was going to take his automaker Tesla private, but then did didn’t do this.

A day after Mr Musk’s offer was made public, Twitter’s board of directors voted unanimously to put the brakes on him by approving the offer poison pill. To defend itself, Twitter turned to Goldman Sachs, its longtime banker, and JPMorgan Chase. For legal advice, the law firm of Simpson Thacher & Bartlett was added to complement their longstanding law practice of Wilson Sonsini.

JPMorgan declined to comment. Morgan Stanley, Goldman Sachs and Simpson Thacher did not immediately comment.

Mr. Musk was undeterred. His bankers began seeks to raise tens of billions of dollars in financing for a Twitter deal. His advisors presented prospective lenders with a few pages that vaguely outlined Mr Musk’s goals. The billionaire has also spoken directly to banks, said a person with knowledge of the calls.

That has helped persuade Citigroup, Bank of America, BNP Paribas, and other banks to invest their money. Despite a lack of details on Mr. Musk’s plans, lenders have been partially reassured by the entrepreneur’s past track record and wealth, the person said.

Mr Musk also lobbied for a deal on Twitter. He indicated that if the company’s board does not accept his offer, he will submit his proposal directly to shareholders in a so-called takeover bid. On April 16th he tweeted“Love me tenderly.” Three days later, he tweeted “____ is the Night,” a reference to the novel “Tender Is the Night” by F. Scott Fitzgerald.

The board of Twitter is broken. On April 16th, Jack Dorsey, a Twitter founder who resigned as managing director November and is a board member tweeted that the board of directors had been the “perennial dysfunction of the company”. When asked by a Twitter user if he could say that, Mr Dorsey replied “no”.

Mr. Dorsey’s criticism has angered other board members and Twitter executives, said two people who worked on the deal. Mr. Taylor asked Mr. Dorsey to stop tweeting negatively, one person said. Mr. Dorsey continued publish references to the board of Twitter.

A spokesman for Mr Dorsey declined to comment. A spokeswoman for Mr Taylor declined to comment.

On April 21, Mr. Musk got in line $46.5 billion in funding. He had received commitments from Morgan Stanley and other lenders for 13 billion dollars in debt financing, while another group of banks promised $12.5 billion in loans against his shares of Tesla. Mr Musk added that he would use a different one $21 billion in cash to buy the remainder of Twitter’s equity.

The funding forced the Twitter board to take Mr. Musk seriously. No other offers for the company have surfaced, said two people familiar with the consultation.

On Twitter, Mr Taylor burdened the insecurity of the employees and the societal impact of a deal on board fiduciary duty, people with knowledge of the situation said. That meant making a decision based on whether Twitter could reasonably get better value than what Mr Musk had suggested.

Mr. Taylor and other board members discussed whether Twitter’s growth prospects for users and revenue are realistic. The San Francisco-based company, which hadn’t turned a profit for eight of the past ten years, had set aggressive business goals.

Twitter also initially benefited from the pandemic, attracting a wave of new users and sending its shares above $77 in February 2021. But its advertising business lagged behind its competitors, and as the pandemic surge subsided, its shares fell below $40.

Still, some board members have been cautious about tuning in a savior-like figure like Mr Musk, especially since Twitter had already relied on such figures – including Mr Dorsey – to get the ship back on track, two people said.

Mr. Musk began preparing a takeover bid for Twitter, said a person close to the discussions. He had a potential ally on the Twitter board Egon Durban, a co-head of private equity firm Silver Lake who worked with Mr. Musk on his failed 2018 attempt to take Tesla private. But Mr. Durban made it clear to the board that Silver Lake would not work with Mr. Musk to provide financing for an acquisition, two people said.

Through a spokesman, Mr. Durban declined to comment.

Last Saturday, Mr. Musk spoke to Mr. Taylor and threatened to make his offer directly to Twitter shareholders without specifically saying he would launch a hostile offer, a person with knowledge of the call said.

On Sunday, Twitter’s board of directors concluded that it needed to strike a deal with Mr. Musk. The company couldn’t reach $54.20 a share on its own, board members agreed, and no white knight came along.

Mr. Taylor told Mr. Musk that Twitter would proceed with a sale, a person with knowledge of the call said. Despite this, Mr. Musk sent a letter to Mr. Taylor threatening a hostile bid.

Twitter’s advisors looked at safeguards for the deal, such as: a demolition fee if Mr. Musk walks away, and a six-month deadline for closing the deal, which could be especially important if tech stocks continue to fall. Musk’s advisors backed the financing details, with the billionaire personally signing off on each item, a person familiar with the negotiations said.

After the agreement was announced Monday afternoon, Mr. Musk did a lap of honor.

“Yes!!!” he tweeted, posting emojis of rockets, stars and hearts.

Anupreeta Das, Maureen Farrell and Kate Conger contributed reporting.

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