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Notice of termination of Twitter merger agreement

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Re: Notice of termination of Twitter merger agreement

#641

Post by jimmydorry »

JauntTrooper wrote: post #566
elliekelly wrote: post #318

Earlier quoted context omitted.

My heart sank when I read your comment: why on earth would the board sue for specific performance!? But my reading of the statement in the tweet is that they plan to sue for enforcement of the agreement which I believe means paying the agreed-upon penalty for backing out of the deal. I don’t at all read that statement as a plan to seek specific performance.

Twitter has a binding agreement to get its shareholders cash at a price that’s nearly 50% higher than todays closing price, a value that the board concluded was superior to their standalone prospects and other alternatives. Why wouldn’t they enforce the agreement and close the deal?

Because it will takes years to enforce and in the meantime Twitter will have bad headlines and huge operational challenges? At best, they are likely to get the break-up clause which would not offset the damage such legal proceedings would cause over the duration of XX months.

Re: Notice of termination of Twitter merger agreement

#642

Post by deelowe »

smcl wrote: post #97
minimaxir wrote: post #3

Elon waived his right to due diligence when he first made the offer to buy Twitter, so backing out of the deal by arguing a lack of due diligence is very funny.

The due-diligence-waive thing isn't really relevant according to Matt Levine, who has been pretty consistent about this for months (see the thread @ https://twitter.com/matt_levine/status/1545151445057536001 ). A couple of choice tweets here: """ the reason that elon musk can't get out of the deal over the bots thing is not that he "waived due diligence." it's that he SIGNED A BINDING AGREEMENT TO BUY TWITTER, and th…

DD would matter in the context that Musk was acting on bad information. But there was no DD AND he wasn't acting on bad information, so it's all moot.

Re: Notice of termination of Twitter merger agreement

#643

Post by danielmarkbruce »

spikels wrote: post #476
chernevik wrote: post #356

Earlier quoted context omitted.

I will be very surprised that Twitter's position was less than "you can have anything you want", precisely to avoid any complaint of non-cooperation. I do agree that the agreement's debt financing provisions may provide Musk an out -- "I wanted to close, but I couldn't get debt b/c you wouldn't cooperate". I'm a little surprised that Twitter agreed to any sort of financing provision, precisely because it seems to all…

Twitter is demanding "specific performance" (i.e. complete the transaction) which is unrealistic given those financing provisions. No court can force all the other parties to close. No financing, no transaction.

I think 6.10f leaves him in trouble. No financing, yes transaction.

Re: Notice of termination of Twitter merger agreement

#644

Post by zrobotics »

Scarbutt wrote: post #629
DelaneyM wrote: post #525

Earlier quoted context omitted.

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. I…

which could easily rebound a bit by EOY. By EOY we could be in recession.

Which actually makes Elon's position worse, since theoretically that reduces Twitter's stock price and increases the spread between the fixed offer and the current valuation. Plus, his financing tanks since it is predicated on Tespa's stock value.

Re: Notice of termination of Twitter merger agreement

#645

Post by jungle2jungle »

adamrezich wrote: post #313

lots of emotionally-charged comments here, which is pretty disappointing. if we look at this dispassionately, perhaps we can come to better conclusions than "elon big poopy head freeze peach bad". for example, one possibility is that Musk never intended to actually buy Twitter because he had reasonable suspicions that the <5% spam/bot figure provided by Twitter was intentionally incorrect (i.e. fraudulent), and he ju…

You are writing fan fiction, not observing reality.

Re: Notice of termination of Twitter merger agreement

#646

Post by zrobotics »

astrange wrote: post #604
DelaneyM wrote: post #525

Earlier quoted context omitted.

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. I…

> 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). Twitter isn't trying to stop him, probably because they don't use their product and may have forgotten they can just ban him.

Banning him at this stage would almost certainly expose Twitter to massive liability, especially as they have shown they will ignore rules for public figures. Twitter could only get away with banning Elon if he egregiously violated their policies, and Elon is too good of a troll to do anything that severe.

Re: Notice of termination of Twitter merger agreement

#648

Post by xenadu02 »

shuckles wrote: post #298
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…

Twitter has already said they'll sue for specific performance: https://twitter.com/btaylor/status/1545526087089696768

It will eventually settle. If they sue and win Musk's financing will have long backed out so they aren't going to end up with enough to close the deal.

I suppose they could force him into bankruptcy which would end up with his ownership stakes in Tesla and SpaceX sold off. Given how much of a loose cannon he's become that would probably be better for other shareholders but who knows.

Re: Notice of termination of Twitter merger agreement

#649

Post by danielmarkbruce »

tsimionescu wrote: post #617
Covzire wrote: post #10

Earlier quoted context omitted.

Musk himself has addressed this, saying that the waiver is null and void if the data supplied to the SEC by Twitter is fraudulent. I can only assume he believes that is the case. >>First, although Twitter has consistently represented in securities filings that “fewer than 5%” of its mDAU are false or spam accounts, based on the information provided by Twitter to date, it appears that Twitter is dramatically understat…

> the waiver is null and void if the data supplied to the SEC by Twitter is fraudulent. Look at said SEC filing. It is worded in a way that is impossible to prove fraudulent with the kind of data Musk asked for. He could have proof positive that he is the only human account on Twitter and the Twitter SEC filing would likely not be construed as lying - it very explicitly states that it is a judgment call by the Twitte…

exactly

Re: Notice of termination of Twitter merger agreement

#650

Post by jimmydorry »

donarb wrote: post #357
somenewaccount1 wrote: post #96

Earlier quoted context omitted.

idk. the fact that the price had already sunk nearly 40% from his price over this period could clearly indicate that his assumption isn't without merit.

But for Musk's machinations, said stock price would not be down 40%. He caused the stock to drop.

I'd say the tech sector getting routed played a bigger part. It's not like Twitter dropping 40% (for any reason) is exceptional amonst all the other stocks that dropped 20-60% over the last year.
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