The deal was announced by the social media platform on Monday after days of negotiations between the world’s richest person and the Twitter board.
Musk had announced an offer to buy the social media platform on 14 April for $54.20 a share, or about $43billion.
The additional $1billion price tag is understood to reflect the purchase of additional shares revealed by Twitter.
The deal means Twitter will now be taken private, ending its run on the stock market which began in 2013.
Musk will pay $54.20 cash per share for the San Francisco-based company, which will now be taken private after days of intense negotiations between the entrepreneur and the platform’s board.
“Twitter has a purpose and relevance that impacts the entire world. Deeply proud of our teams and inspired by the work that has never been more important,” said Parag Agrawal, Twitter’s CEO was quoted to have said.