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Notice of termination of Twitter merger agreement

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Re: Notice of termination of Twitter merger agreement

#451

Post by mlyle »

redeeman wrote: post #419
duxup wrote: post #185

Earlier quoted context omitted.

> But it's unclear to me what he initially thought he was getting out of this. The more it goes on it feels like “I don't like how twitter works, I’ll show them! ” Later: “Oh noes if I do what I want here the result might be bad…” It just feels like a YOLO business deal that wasn’t thought out the more this goes on.

isnt it also possible he (some might say rather impulsively) decided to buy twitter, and then upon further investigating finds that his quick rationales no longer make sense if bot traffic indeed is way above 5%? that perhaps he feels that if it indeed is way above 5%, twitter is scamming? is this just 100% unthinkable?

Good luck with that. He tweeted, early on: "If our Twitter bid succeeds, we will defeat the spam bots or die trying!"

Then, when you conclude a definitive agreement without any provision for an "out" based on an issue that you've already acknowledged knowing about (and hoping to fix post-acq)-- you're kinda stuck with it.

I think the big issue is that with the movement in equities, it requires him to overpay for Twitter with Tesla stock that is much less valuable. Financing the deal got much harder for him.

Re: Notice of termination of Twitter merger agreement

#453

Post by raldi »

kelnos wrote: post #291
avalys wrote: post #197

Earlier quoted context omitted.

The deal includes a "specific performance" clause, which allows Twitter to force Musk to carry out the deal. He can't simply pay $1 billion and walk away, he's in for a very messy legal fight. This pretext about bots is incredibly weak and he's in no way guaranteed to win. If this really were part of some grand master plan, I think he would have left himself an easier out.

It also depends on what the Twitter board and shareholders want. Will they want to get bought out and owned by someone who clearly doesn't want to own the company, and may run it into the ground out of spite? Certainly some shareholders will just want to take the money and run (the agreed-upon buyout price is quite a premium over the current stock price), but others will be more interested in protecting the future of…

Your second sentence makes no sense. If the board and shareholders sell the company, "they" aren't owned by anyone. The board is no longer the board and the shareholders are no longer the shareholders. They're just a bunch of regular people holding big bags of money.

It's like if you sell your car to a dangerous driver: you have no financial stake in whether they go on to crash it.

Re: Notice of termination of Twitter merger agreement

#454

Post by Sebb767 »

the_biot wrote: post #308
openthc wrote: post #212

Earlier quoted context omitted.

More than one financial analysit/money manager has floated this idea in our circle. It seems reasonalble; an pointing to the last time he sold a bunch (11B?) and told everyone it was to pay his taxes. They seem to think it was to just convert some high-risk (TSLA) to low risk (Cash, etc).

That sounds reasonably logical, but by what measure of logic is overpaying for Twitter, of all assets, a good deal? There are surely better companies to do this sort of thing with, and end up with an actually valuable asset at the end of it.

According to this theory, he never intended to buy Twitter. He just used the offer to liquidate stock without raising too many eyebrows and now he's backing out, with a few billion extra in cash and, if everything works out for him, not even a termination fee.

Re: Notice of termination of Twitter merger agreement

#455

Post by mlyle »

jessaustin wrote: post #80
timsneath wrote: post #17

It seems apparent to this observer that he developed cold feet pretty fast after an impetuous decision, and has been looking for any reason to back out of it since then. The spam accounts angle seems like a convenient scapegoat, rather than a real surprise to him. He's clearly eccentric in his approach to decision making: I don't think any Harvard Business School course will teach "the Musk Principles". But it's uncl…

Either he was breathlessly arrogant or astonishingly careless in the first instance. Perhaps he didn't expect the Nasdaq composite to drop 2000 over the next several months? That could have been careless, depending on the sort of agreement he signed. I guess he can afford a $1B penalty, but good luck finding another buyer after that. It's not as though Twitter are overflowing with ideas for profit...

> I guess he can afford a $1B penalty,

The $1B is if there's some outside reason why the deal cannot get done, e.g. because of regulatory concerns.

It's not a "pay a $1B break-up fee at your discretion to get out of the deal" clause.

> Accordingly, the parties hereto acknowledge and agree that the parties hereto shall be entitled to an injunction, specific performance and other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof, in addition to any other remedy to which they are entitled at law or in equity. Each of the parties hereto agrees that it will not oppose the granting of an injunction, specific performance and other equitable relief on the basis that any other party has an adequate remedy at law or that any award of specific performance is not an appropriate remedy for any reason at law or in equity.

...

> (b) Notwithstanding anything herein to the contrary, including the availability of the Parent Termination Fee or other monetary damages, remedy or award, it is hereby acknowledged and agreed that the Company shall be entitled to specific performance or other equitable remedy to enforce Parent and Acquisition Sub’s obligations to cause the Equity Investor to fund the Equity Financing, or to enforce the Equity Investor’s obligation to fund the Equity Financing directly, and to consummate the Closing ....

Re: Notice of termination of Twitter merger agreement

#456

Post by hertzrat »

atlasunshrugged wrote: post #60
timsneath wrote: post #17

It seems apparent to this observer that he developed cold feet pretty fast after an impetuous decision, and has been looking for any reason to back out of it since then. The spam accounts angle seems like a convenient scapegoat, rather than a real surprise to him. He's clearly eccentric in his approach to decision making: I don't think any Harvard Business School course will teach "the Musk Principles". But it's uncl…

There's another belief floated by Josh Wolfe (an investor with Lux Capital) who claimed it was a ruse to liquidate Tesla stock en masse without Tesla hodlers getting suspicious and tanking the inflated stock price. https://twitter.com/wolfejosh/status/1545387947578597376

I don’t buy it. Musk compulsively creates huge and innovative companies. To liquidate stock, he could just as easily have just waited until his next big thing and sold off his stock then, once again, in order to pay for a non-Tesla venture; and then either used the money for the company, or bailed on the new company. Involving Twitter doesn’t make sense and is unnecessary

Re: Notice of termination of Twitter merger agreement

#457

Post by hunterb123 »

thirdvect0r wrote: post #189
hunterb123 wrote: post #153

ITT: - Elon is stupid, haha he will lose money. - Elon is evil, he's trying to pull a fast one on this corporation! - Elon waived his rights, he shouldn't have agreed to their fake numbers! - Twitter is allowed to claim whatever % of spam bots they want for the deal. - Twitter's censorship is actually a good thing, here's why...

With age, you will look back on your infantile attitude to this situation and realise that you were simply a rube.

You went straight to personal attacks. You may be the one that needs to grow up.

If you disagree with my summaries or don't think they occurred in the thread, dispute it. I see no reason to attack me personally.

Re: Notice of termination of Twitter merger agreement

#458

Post by mlyle »

kelnos wrote: post #291
avalys wrote: post #197

Earlier quoted context omitted.

The deal includes a "specific performance" clause, which allows Twitter to force Musk to carry out the deal. He can't simply pay $1 billion and walk away, he's in for a very messy legal fight. This pretext about bots is incredibly weak and he's in no way guaranteed to win. If this really were part of some grand master plan, I think he would have left himself an easier out.

It also depends on what the Twitter board and shareholders want. Will they want to get bought out and owned by someone who clearly doesn't want to own the company, and may run it into the ground out of spite? Certainly some shareholders will just want to take the money and run (the agreed-upon buyout price is quite a premium over the current stock price), but others will be more interested in protecting the future of…

> but others will be more interested in protecting the future of Twitter as a company and platform.

Almost everyone votes their economic interest.

Re: Notice of termination of Twitter merger agreement

#459

Post by [deleted] »

meragrin_ wrote: post #322
chernevik wrote: post #264

The filed letter ( https://www.sec.gov/Archives/edgar/data/1418091/000110465922... ) isn't the knockdown argument I would be expecting. Musk is saying, you haven't demonstrated your numbers are accurate. But having signed the merger agreement and waived due diligence, I think he needs to demonstrate that they are _not_ accurate. Complaining Twitter rate-limited his API access (which would be very foolish on their par…

> Musk is saying, you haven't demonstrated your numbers are accurate. It has nothing to do with accuracy. Twitter is supposedly not providing the data: 'While Section 6.4 of the Merger Agreement requires Twitter to provide Mr. Musk and his advisors all data and information that Mr. Musk requests “for any reasonable business purpose related to the consummation of the transaction,” Twitter has not complied with its con…

[deleted]

Re: Notice of termination of Twitter merger agreement

#460

Post by [deleted] »

idiotsecant wrote: post #216
TillE wrote: post #57

Earlier quoted context omitted.

I suspect the initial decision was something like "hey I could actually just buy Twitter, that would be funny". It's less clear to me why he almost immediately started trying to back out. It's probably a waste of a significant chunk of money, but is that all?

It makes more sense if you assume that Elon Musk is both a sometimes successful businessman and also suffering from unmanaged bipolar disorder.

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