Mergers and Acquisitions: Twitter's Share Prices and Trading Volumes
Added on 2023-06-08
16 Pages6767 Words82 Views
MERGERS AND ACQUISITIONS
Table of Contents
INTRODUCTION ..........................................................................................................................3
QUESTION 1.................................................................................................................................3
Compilation of table comparing Twitter's daily share prices and trading volumes....................3
Line Graph for the month of April 2022.....................................................................................6
Reaction of Twitter's share price and trading volume on 4th April 2022...................................8
QUESTION 2.................................................................................................................................9
Twitter share price and trading volume on 14th April 2022.......................................................9
Define the “flip-in poison pill” and its uses...............................................................................10
Premium price offered by Musk's............................................................................................11
QUESTION 3...............................................................................................................................11
Reaction of Twitter's share price and trading volume on 25th April 2022...............................11
Which single event had the largest effect weather positively and negatively on Twitter's share
prices and trading volumes in April 2022................................................................................12
Difference between merger and acquisition............................................................................13
QUESTION 4...............................................................................................................................14
Motives for pursuing a M&A deal ...........................................................................................14
Five stages of the “Watson Wyatt deal flow model” of M&As.................................................15
CONCLUSION ............................................................................................................................17
REFERENCES............................................................................................................................18
INTRODUCTION ..........................................................................................................................3
QUESTION 1.................................................................................................................................3
Compilation of table comparing Twitter's daily share prices and trading volumes....................3
Line Graph for the month of April 2022.....................................................................................6
Reaction of Twitter's share price and trading volume on 4th April 2022...................................8
QUESTION 2.................................................................................................................................9
Twitter share price and trading volume on 14th April 2022.......................................................9
Define the “flip-in poison pill” and its uses...............................................................................10
Premium price offered by Musk's............................................................................................11
QUESTION 3...............................................................................................................................11
Reaction of Twitter's share price and trading volume on 25th April 2022...............................11
Which single event had the largest effect weather positively and negatively on Twitter's share
prices and trading volumes in April 2022................................................................................12
Difference between merger and acquisition............................................................................13
QUESTION 4...............................................................................................................................14
Motives for pursuing a M&A deal ...........................................................................................14
Five stages of the “Watson Wyatt deal flow model” of M&As.................................................15
CONCLUSION ............................................................................................................................17
REFERENCES............................................................................................................................18
INTRODUCTION
In the modern business environment restructuring of the business entities is become a
crucial concern for growth. Recent developments in the global economy has persuaded
business organisations to have innovative and efficient business policies which help them to
survive in this competitive business environment. Competition has increased to a greater extent
that without having a splendid knowledge about different market factors and smart business
tactics it is become difficult for organisations to continue their present business practices.
Business entities are required to have an in-depth understanding of different market policies
which could be used to deal with all kind of business situations in an economical manner.
Merger and acquisition is one of the most popular restructuring technique which could help
organisations to increase their commercial activities size and scale. In the developed countries
mergers and acquisitions become a strategic feature for business entities through which they
can scale up their commercial activities and market value. Merger and acquisition: these two
words are often use interchangeably but they have different meanings associated with them.
Where merger refers towards integration of two separate entities as newly fresh business entity
while acquisition refers acquiring one entity in entirety by an another business entity (Amir and
et.al, 2021). This report delivers valuable insights over recent proposed acquisition of Twitter by
Elon Musk and effect on Twitter's share price before the acquisition announcement and after
that. The concept of “Flip-in poison pill” is also explained in this report in context of the Twitter
company. Reasons for changes in the stock prices of the Twitter company are given in order to
assess the actual situation arises during this acquisition. In last, this report states about the
possible motives which prompted Elon Musk for acquisition of Twitter company as well as
stages of “Watson Wyatt deal flow model of mergers and acquisitions in reference for this
acquisition.
QUESTION 1
Compilation of table comparing Twitter's daily share prices and trading volumes
Prices of financial instruments are keep changing in the financial market. There are
many factors in the business environment which affects trading prices of these instruments.
Business organisations should keep an eye over the changes in their stock prices to track each
and every factor which could affect its share price positively or negatively although there are no.
of factors which cannot be controlled by the organisations (Bartov and et.al, 2021). Likewise,
after the announcement of the acquisition of Twitter company by Elon Musk there are significant
changes in its stock prices and trading volume. Below mentioned table presents a useful
comparison between Twitter's daily share prices and trading volumes before and after the
announcement date on a timeline of key events related to Elon Musk's purchases of Twitter
which is as follows:
S.
No.
Date Closing Price in
US dollar
Trading
Volume
Key Elon Musk Events
1 31/01/22 37.51 17558300 Musk started to build his
stake in the Twitter silently.
2 14/03/22 33.03 17551500 His stake crosses 5 % of
In the modern business environment restructuring of the business entities is become a
crucial concern for growth. Recent developments in the global economy has persuaded
business organisations to have innovative and efficient business policies which help them to
survive in this competitive business environment. Competition has increased to a greater extent
that without having a splendid knowledge about different market factors and smart business
tactics it is become difficult for organisations to continue their present business practices.
Business entities are required to have an in-depth understanding of different market policies
which could be used to deal with all kind of business situations in an economical manner.
Merger and acquisition is one of the most popular restructuring technique which could help
organisations to increase their commercial activities size and scale. In the developed countries
mergers and acquisitions become a strategic feature for business entities through which they
can scale up their commercial activities and market value. Merger and acquisition: these two
words are often use interchangeably but they have different meanings associated with them.
Where merger refers towards integration of two separate entities as newly fresh business entity
while acquisition refers acquiring one entity in entirety by an another business entity (Amir and
et.al, 2021). This report delivers valuable insights over recent proposed acquisition of Twitter by
Elon Musk and effect on Twitter's share price before the acquisition announcement and after
that. The concept of “Flip-in poison pill” is also explained in this report in context of the Twitter
company. Reasons for changes in the stock prices of the Twitter company are given in order to
assess the actual situation arises during this acquisition. In last, this report states about the
possible motives which prompted Elon Musk for acquisition of Twitter company as well as
stages of “Watson Wyatt deal flow model of mergers and acquisitions in reference for this
acquisition.
QUESTION 1
Compilation of table comparing Twitter's daily share prices and trading volumes
Prices of financial instruments are keep changing in the financial market. There are
many factors in the business environment which affects trading prices of these instruments.
Business organisations should keep an eye over the changes in their stock prices to track each
and every factor which could affect its share price positively or negatively although there are no.
of factors which cannot be controlled by the organisations (Bartov and et.al, 2021). Likewise,
after the announcement of the acquisition of Twitter company by Elon Musk there are significant
changes in its stock prices and trading volume. Below mentioned table presents a useful
comparison between Twitter's daily share prices and trading volumes before and after the
announcement date on a timeline of key events related to Elon Musk's purchases of Twitter
which is as follows:
S.
No.
Date Closing Price in
US dollar
Trading
Volume
Key Elon Musk Events
1 31/01/22 37.51 17558300 Musk started to build his
stake in the Twitter silently.
2 14/03/22 33.03 17551500 His stake crosses 5 % of
total shareholding but
remain undisclosed.
2 24/03/22 38.82 18281400 Musk started to criticise the
company on its own social
media platform.
3 04/04/22 49.97 268465400 His stake got disclosed to
public which is 9.2% highest
stake of individual investor
in Twitter.
4 05/04/22 50.98 217520100 Elon Musk become a major
active investor of the
company and invited to hold
a seat of director of Twitter.
5 11/04/22 47.01 117814000 Musk refuses to join the
company as a director.
6 14/04/22 45.08 258868300 All of a sudden Elon Musk
offers to buy the Twitter
company.
7 21/04/22 47.08 70413600 Musk declares that he has
organised the required
fund for Twitter acquisition.
8 25/04/22 51.70 176803600 Twitter agrees to acquisition
by Elon Musk for $ 44
billion
9 04/05/22 49.06 28443000 Musk organised funds for
the acquisition
10 06/05/22 49.80 23446300 Musk declares his objective
for the company to increase
its revenue to $ 26.4 billion
till 2028
11 10/05/22 47.26 23816700 Musk states that he will
regularise the former US
president’s Twitter
account if the deal gets
complete
12 16/05/22 37.39 52310700 In an summit, Musk
announced that according to
him 20 % of registered
users of Twitter, the biggest
social media platform are
remain undisclosed.
2 24/03/22 38.82 18281400 Musk started to criticise the
company on its own social
media platform.
3 04/04/22 49.97 268465400 His stake got disclosed to
public which is 9.2% highest
stake of individual investor
in Twitter.
4 05/04/22 50.98 217520100 Elon Musk become a major
active investor of the
company and invited to hold
a seat of director of Twitter.
5 11/04/22 47.01 117814000 Musk refuses to join the
company as a director.
6 14/04/22 45.08 258868300 All of a sudden Elon Musk
offers to buy the Twitter
company.
7 21/04/22 47.08 70413600 Musk declares that he has
organised the required
fund for Twitter acquisition.
8 25/04/22 51.70 176803600 Twitter agrees to acquisition
by Elon Musk for $ 44
billion
9 04/05/22 49.06 28443000 Musk organised funds for
the acquisition
10 06/05/22 49.80 23446300 Musk declares his objective
for the company to increase
its revenue to $ 26.4 billion
till 2028
11 10/05/22 47.26 23816700 Musk states that he will
regularise the former US
president’s Twitter
account if the deal gets
complete
12 16/05/22 37.39 52310700 In an summit, Musk
announced that according to
him 20 % of registered
users of Twitter, the biggest
social media platform are
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