26 votes

Elon Musk says he’s terminating $44B Twitter buyout deal

13 comments

  1. [2]
    balooga
    Link
    Can't say I'm shocked in the least. I'd wager this was his plan from the beginning.

    Can't say I'm shocked in the least. I'd wager this was his plan from the beginning.

    12 votes
    1. Rez
      Link Parent
      I wouldn't say it was necessarily his plan, but I think he saw through an example like Trump that if you've got enough money and enough political/social clout, you can pretty much drag things out...

      I wouldn't say it was necessarily his plan, but I think he saw through an example like Trump that if you've got enough money and enough political/social clout, you can pretty much drag things out forever through lawsuits until the issue no longer matters or people just want to settle to have it be over with (Trump also did this prior to being President).

      The basic game of chicken is: what are you gonna do, arrest me? If the lawsuit carries on for years, that's enough time for any number of x factors to occur, from Twitter imploding as a business or agreeing to a settlement, to tech stocks rebounding, to a new administration that's politically favorable to him, and so on. For example, Twitter could agree to a settlement because having a suit like this hanging over your company for years could do a lot to deter other potential investors, business deals and partnerships.

      9 votes
  2. [8]
    HotPants
    Link
    I thought they gave him all the data he requested. I wonder if he sold his 10% stake, at a profit, before making this announcement? Will twitter go after the $1 billion breakup fee?

    In a letter to the Securities and Exchange Commission, Musk said Twitter has “not complied with its contractual obligations” surrounding the deal, namely giving Musk enough information to “make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform.”

    I thought they gave him all the data he requested.

    I wonder if he sold his 10% stake, at a profit, before making this announcement?

    Will twitter go after the $1 billion breakup fee?

    12 votes
    1. cfabbro
      Link Parent
      He also waived due diligence when he made the offer, so this whole bot/spam and user data excuse is total BS, as per usual with him.

      He also waived due diligence when he made the offer, so this whole bot/spam and user data excuse is total BS, as per usual with him.

      16 votes
    2. shiruken
      Link Parent
      At this point, I'd be surprised if he didn't. Flagrantly flaunting securities regulations while openly taunting the SEC is basically his hobby now.

      I wonder if he sold his 10% stake, at a profit, before making this announcement?

      At this point, I'd be surprised if he didn't. Flagrantly flaunting securities regulations while openly taunting the SEC is basically his hobby now.

      9 votes
    3. TheRtRevKaiser
      Link Parent
      He also waived due diligence so I'm not sure if he has a leg to stand on here, but I definitely don't understand this kind of thing.

      He also waived due diligence so I'm not sure if he has a leg to stand on here, but I definitely don't understand this kind of thing.

      6 votes
    4. [4]
      HotPants
      Link Parent
      ...from twitter The stock market does not look as confident :)

      The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.

      ...from twitter

      The stock market does not look as confident :)

      4 votes
      1. [2]
        babypuncher
        Link Parent
        The current stock price doesn't matter. The Elongated Muskrat signed a contract stipulating that it would purchase the company for $44b. That fuckwit can't just back out because now it seems like...

        The current stock price doesn't matter. The Elongated Muskrat signed a contract stipulating that it would purchase the company for $44b. That fuckwit can't just back out because now it seems like too much money.

        I hope it gets raked over the coals.

        5 votes
        1. HotPants
          Link Parent
          The stock price is an expert level prediction market based signal. Normally when the market expects an acquisition to go through, the stock price shoots up to the acquisition price and sticks...

          The stock price is an expert level prediction market based signal.

          Normally when the market expects an acquisition to go through, the stock price shoots up to the acquisition price and sticks there. Since May, the TWTR stock price has clearly been saying the market did not think the acquisition will go through.

          While the twitter board sounds confident that they can/will sue Musk to pay $44b, the market clearly disagrees.

          2 votes
      2. stu2b50
        Link Parent
        I wonder if it's a leverage play from Musk. He may, in a bit of time, re-make the offer at a much lower price (one closer to the current stock price). Given the choice between a lengthy court case...

        I wonder if it's a leverage play from Musk. He may, in a bit of time, re-make the offer at a much lower price (one closer to the current stock price). Given the choice between a lengthy court case with a non-trivial chance of failure (we are in the very strange situation where the individual has more money than the company, and by A LOT, albeit Twitter will have much stronger cashflow), and the overall tech market collapsing, the board may take the guaranteed exit.

        It could also just be Musk doing Musk things.

        1 vote
  3. [3]
    babypuncher
    Link
    Honestly I hope Twitter rakes it over the coals with this and forces it to go through with the $44b buyout. It will have to sell an awful lot of devalued Tesla stock just to make that happen.

    Honestly I hope Twitter rakes it over the coals with this and forces it to go through with the $44b buyout. It will have to sell an awful lot of devalued Tesla stock just to make that happen.

    5 votes
    1. [2]
      HotPants
      Link Parent
      Matt Levine thinks Twitter can force the buy out But the twitter stock price disagrees. I wonder if Matt Levine is buying twitter stock right now?

      Matt Levine thinks Twitter can force the buy out

      I like Twitter’s odds — its odds of getting specific performance and making Musk close the deal — in court, but I don’t think anything is a certainty at this point.

      But the twitter stock price disagrees.

      I wonder if Matt Levine is buying twitter stock right now?

      4 votes
      1. cfabbro
        (edited )
        Link Parent
        It’s not just Levine. From what I have been reading elsewhere (e.g.), quite a few legal experts think Twitter is likely to be able to either enforce the agreement, or get the withdrawal fee +...

        It’s not just Levine. From what I have been reading elsewhere (e.g.), quite a few legal experts think Twitter is likely to be able to either enforce the agreement, or get the withdrawal fee + damages. And they also think Twitter will likely be able to fast track the case too. The reason for all this is because the deal’s conditions were clear, proving material adverse effect is an incredibly high bar to meet, and Delaware’s Chancery Court judges apparently don’t fuck around when it comes to these sorts of high-profile contract law decisions, since that’s Delaware’s bread and butter.

        4 votes