There's something I don't understand re: Twitter & Musk

[PJMcK]

Musk wanted to buy Twitter and they agreed on a price. Almost immediately, Musk started trash talking some Twitter executives and he made demands about the user base. Specifically, he wanted a detailed explanation about how many bots were among the user base claiming that there are far more bots than Twitter acknowledges.

Now Musk is pulling out of the deal and it's been reported that he will have to pay a $1 Billion cancellation fee. I'm sure this will be a protracted legal fight. Meanwhile, Twitter's stock value has diminished significantly since the potential deal was announced.

That's the outline of the story as I've understood it. But I don't understand what was really going on!

Any insights are greatly appreciated.

[ananda]

1. He thought it would become his rightwing play toy.

And when that wasn't going to happen, well ....

[PJMcK]

2. That seems too simplistic

After all, he was willing to pay $44 Billion! For a "play toy?"

It's very weird and from my own business experiences (nothing on this scale, of course!), the story is confusing and doesn't make a lot of sense.

[keithbvadu2]

3. One speculation was that this was just a ploy to drop Tesla's stock so he could buy more back for le

One speculation was that this was just a ploy to drop Tesla's stock so he could buy more back for less money.

[PJMcK]

7. That's quite plan!

Ver Machiavellian.

[no_hypocrisy]

4. My guess is that when Musk criticized Twitter, what he was really doing was

negotiating for a lower sales price, which the Board of Directors and shareholders refused to do.

When they say it isn't about the money, it's about the money.

[unblock]

5. You left out the part where the entire stock market went down 15% or so

Making musk's offer price wildly over-market.

By far more than the $1 billion break-up fee

[PJMcK]

8. Good point (n/t)

[Farmer-Rick]

6. Well, if you wanted to trash Twitter stock because

They blocked your favorite psychopath wana be dictator.

Seems what Musk did worked.

"Meanwhile, Twitter's stock value has diminished significantly since the potential deal was announced."

He's got tons of lawyers. He can get the cancellation fee down. Depends on how the contract was written but that $1 billion is pennies for Musk.

"Elon Musk can walk away from his $44 billion (€41.5 billion) takeover of social media platform Twitter for $1 billion, a significantly lower penalty than in the typical leveraged buyout.

The “reverse termination fee”, revealed in a regulatory filing by Twitter on Tuesday, means Mr Musk could abandon the deal by paying less than 1 per cent of his net worth and a fraction of the $21 billion of equity he has committed to complete the acquisition."

https://www.irishtimes.com/business/technology/elon-musk-can-walk-away-from-twitter-deal-by-paying-1bn-break-fee-1.4863199

[LetMyPeopleVote]

9. Twitter has hired Wachtell Lipton to sue Musk

Link to tweet