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Notice of termination of Twitter merger agreement

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Re: Notice of termination of Twitter merger agreement

#521

Post by phailhaus »

remflight wrote: post #483

Twitter can’t give Musk the data he needs to determine fake accounts. It’s obvious that while Twitter does some work to detect fake accounts, they probably only go after low hanging fruit. Twitter is balancing investment costs vs impact to the platform and obviously they are coming in light. Everyone that uses Twitter knows it has a bot problem. If Musk’s team does a deeper dive than Twitter is willing to invest in a…

> Twitter can’t give Musk the data he needs to determine fake accounts.

Twitter has already given Musk access to the "firehose of data". [1]

Musk bragged about buying Twitter because of the bots. Nobody is going to believe that he suddenly cares now that there are too many, not after he waived due diligence and set the buying price as a 420 joke.

[1] https://www.wired.com/story/elon-musk-twitter-firehose/

Re: Notice of termination of Twitter merger agreement

#522

Post by [deleted] »

starkd wrote: post #501
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…

The twitter board has already announced it intends to litigate this. And they are not after just the $1B fee. That might be what Mr. Musk had in mind when he mentioned he was lawyering up in a few tweets awhile back. Even though he waved due diligence, that might not clear twitter from having lied about the bot problem. I suspect this is going into months of litigation. Perhaps Twitter will be willing to accept a low…

[deleted]

Re: Notice of termination of Twitter merger agreement

#524

Post by raydev »

camjohnson26 wrote: post #40
zimpenfish wrote: post #11

Earlier quoted context omitted.

> They’re saying they’re lying about the numbers. Which would be fraud. But they've been sending the SEC these same numbers calculated using the same methodology since 2013, right? If they were materially adverse circumstances, you'd imagine that someone would have caught this in the last 9 years...

Also, Musk routinely knowingly confuses DAUs and normal users. Twitter claims 5% of daily active users are bots, but Musk complains about how many of his followers are bots, when clearly many of those wouldn’t be DAUs. Twitter’s CEO has addressed this. Musk responded with a poop emoji: https://twitter.com/paraga/status/1526237578843672576?s=20&t...

> Twitter claims 5% of daily active users are bots

You also left out an important piece: 5% of their *monetizable* DAU. Not just DAU.

But you're right, Elon's been convincing the public that Twitter has made claims they never actually made.

Re: Notice of termination of Twitter merger agreement

#525

Post by DelaneyM »

beeboop wrote: post #376
DelaneyM wrote: post #45

For anyone thinking he can pay the 1B$ termination fee and walk away, it's not that simple. The 1B$ is a "reverse breakup" fee, and applies when an outside force (like SEC or financing) prevents the deal. That 1B$ has nothing to do with any choices on either side, and is unlikely to factor into this process. At this point they're clearly going to trial, and it's not unlikely that the cost to Elon will be somewhere in…

When has there ever been a lawsuit of this sort that was anywhere near $15 billion? What do you base these numbers on?

As in my post, assuming this reaches a "negotiated" settlement there are going to be two important values: the original purchase price (OPP), and the fair market value (FMV).

If Twitter "wins", they get Elon to pay the full market value. Now, they don't actually want Elon to be involved, so if Elon pays the difference between FMV and OPP (~$24B) that's essentially the same as buying then divesting with fewer steps.

If Elon "wins", he gets out paying nothing.

So the range is 0 to $24B.

Elon has a terrible case here, so the best negotiating tactic he has is being a disruptive asshole so TWTR just wants it done with (this is playing to his strengths). I'm also making a big assumption about the FMV, which could easily rebound a bit by EOY. With those factors pulling it down from 24, I'm expecting in the 10-15 range, and if I had to guess I'd say $12.5B.

Pick your own inputs for your own estimate, but this is the deal structure.

Re: Notice of termination of Twitter merger agreement

#526

Post by remflight »

phailhaus wrote: post #521
remflight wrote: post #483

Twitter can’t give Musk the data he needs to determine fake accounts. It’s obvious that while Twitter does some work to detect fake accounts, they probably only go after low hanging fruit. Twitter is balancing investment costs vs impact to the platform and obviously they are coming in light. Everyone that uses Twitter knows it has a bot problem. If Musk’s team does a deeper dive than Twitter is willing to invest in a…

> Twitter can’t give Musk the data he needs to determine fake accounts. Twitter has already given Musk access to the "firehose of data". [1] Musk bragged about buying Twitter because of the bots. Nobody is going to believe that he suddenly cares now that there are too many, not after he waived due diligence and set the buying price as a 420 joke. [1] https://www.wired.com/story/elon-musk-twitter-firehose/

Read the letter from the lawyers. They gave Musk’s team limited access via api until a couple of days ago despite asking for it since may. The limited access was rate limited and had other restrictions. It’s obvious that with a rate limit the amount of data is not enough to do what they need to do.

Re: Notice of termination of Twitter merger agreement

#527

Post by ergocoder »

asah wrote: post #492
cormacrelf wrote: post #103

Earlier quoted context omitted.

It’s because they want him to pay the agreed price. It is an extremely good deal for the shareholders now, so they are behaving perfectly rationally. And they can possibly force him to.

In fact they have a fiduciary responsibility to pursue this.

People keep saying this... But twitter board accepts the very first offer from Musk.

Who does that in a business negotiation?

Re: Notice of termination of Twitter merger agreement

#528

Post by BenoitEssiambre »

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 also read somewhere that if Elon ran Twitter into the ground in the next decade, using it just to advertise Tesla cars, he would have paid an amount in line with what GM pays for advertising their cars (at least what they paid pre-pandemic) https://www.statista.com/statistics/286522/general-motors-ad....

It blows my mind how much (non Tesla) car companies spend just on advertising.

Re: Notice of termination of Twitter merger agreement

#529

Post by datavirtue »

mzs wrote: post #190
pryce wrote: post #155

Earlier quoted context omitted.

If someone's stock is as incredibly overinflated as Tesla has been for so long, choosing the most effective way to liquidate stock without triggering a run becomes a social engineering problem with the incentive of a multi-billion dollar payoff. Honestly I think other people trying to read this situation in some way that ignores a multi billion dollar incentive just sitting there is utterly naive.

You say social engineering, I say criminal fraud.

I have accepted that I will eventually see Musk put behind bars--all of a sudden--by the SEC. I get the sense that they are always building a case on him. He would be a great "Martha Stuart."

Re: Notice of termination of Twitter merger agreement

#530

Post by throwntoday »

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…

While I would agree his offer was absurdly overvaluing twitter, and reason enough to back out after sobering up, if what is being stated in the letter is true, twitter has likely been committing serious fraud.

It has continually been one of the most underperforming platforms of it's size. Head of Data Science resigning doesn't bode well during a deal hinging on the accuracy of the data.

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