Twitter's stock jumped more than 3% on news that the company is close to reaching an agreement with Elon Musk, which could be announced as soon as Monday.
Musk made a bid to purchase Twitter for $54.20 per share, or $43 billion, earlier this month. The social media business was anticipated to reject a deal and has implemented a "poison pill" to stave off a hostile acquisition. Following Musk's announcement that he had collected $46.5 billion in funding, Twitter became more amenable to an offer.
According to a person close to the matter, the company's board convened on Sunday to examine Musk's finance strategy for his planned acquisition.
According to Bloomberg and Reuters, the two parties might strike a deal as early as Monday. According to The New York Times, the board discussed with Musk until the early hours of Monday morning.
It's uncertain how a final agreement would look, and Reuters reported on Monday that one might yet fall apart. According to Reuters, Twitter has not been able to get a "go-shop" agreement, which would allow it to search for alternative offers after signing an agreement. It said that the firm may consider another proposal provided Musk pays a break-up fee.
In a Sunday note, Wedbush analyst Dan Ives predicted that the news of Twitter's openness to a bid will be viewed by Wall Street as "the beginning of the end for Twitter as a public business, with Musk likely now on a road to purchase the firm unless a second bidder gets into the mix."
On CNBC's "Squawk on the Street," Jim Cramer stated, "I think they nearly have to" take the proposal. Twitter is expected to publish dismal first-quarter profits on Thursday, according to several analysts, including Cramer.
In a Monday note, Gordon Haskett wrote, "Locking up a deal today or tomorrow may sound pretty appealing for someone who knows they are in possession of bad news."
Twitter did not respond to requests for comment. In the morning, Tesla shares were down less than 1%.
Tesla and SpaceX CEO Elon Musk has been on a tear to buy Twitter. Before making a bid for the firm, he had built up more than 9% in equity and turned down an opportunity to join the board of directors.
Musk, a frequent Twitter user, has argued that it should be "converted" into a private firm so that it may function as a platform for free speech. He further claims that the interests of Twitter's board members "are simply not aligned with shareholders" and that the board "owns essentially no shares" in the firm.
Click here for more trending news