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Notice of termination of Twitter merger agreement

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Re: Notice of termination of Twitter merger agreement

#891

Post by krisoft »

RC_ITR wrote: post #726
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…

It’s so crazy to me that the purchase price was determined by a weed joke and people are surprised that in the cold sober light of our recent correction, Musk is trying to get out of this. His whole M.O. is degrading the power of the SEC and DoJ by pointing out they have very little enforcement power. This is just another example in his long journey of “what are they going to do if I just don’t follow the rules?” Wei…

> people are surprised that in the cold sober light of our recent correction, Musk is trying to get out of this

People are not surprised. People were expecting this. As evidenced by the discussion then and now. Also as evidenced by the contract which was drafted at the time between him and twitter.

Re: Notice of termination of Twitter merger agreement

#892

Post by nabla9 »

synu wrote: post #697
stingraycharles wrote: post #694

Earlier quoted context omitted.

I actually have experience with this type of stuff, some business tried to acquire mine and kept postponing, and ended up with some excuse that there wasn’t enough technical design documentation, which would be a real-breaker. It wasn’t super big money, but also not small (high 6-figures). I ended up suing them, won on all counts, and the deal had to go through. Unfortunately, this company simply refused to do that e…

What happened when they ignore dthe order from the judge? Nothing?

If he willfully disobeyed, there will be sequestration order against his assets.

The court will appoint someone else to go trough his assets and find a way to pay. Selling Tesla stocks for example.

Re: Notice of termination of Twitter merger agreement

#893

Post by JamesSwift »

cornel_io wrote: post #714
JamesSwift wrote: post #619

Earlier quoted context omitted.

> Twitter is supposedly not providing the data Not really. Reading the letter it sounds more like Musk has started to make more specific requests, likely in the hopes of them not being able to service them. For example, he claims in the letter that he requested daily mDAU numbers for the previous 8 quarters (i.e. 2 years) and they only gave him rolled-up numbers. I find it completely believable that they may not have…

If you've ever run analytics at even a mid-sized company (let alone large, where it's even more critical to keep this stuff), getting daily mDAU is trivial and you'd have to have a grossly irresponsible data policy to be unable to pull that. Nobody worth their wage drops data that aggressively unless they are compelled by law.

I dont have enough experience in analytics to know what data points would be full fidelity vs rollup. I'm just stating that theres no guarantee they even have the data to service his requests, and I dont believe they were under any existing obligation to maintain it before Musk got involved.

Re: Notice of termination of Twitter merger agreement

#894

Post by sk8terboi »

partloyaldemon wrote: post #691

Chancery courts will compel performance of this transaction absent a showing of an material adverse advent. Very, very high bar. The buyer is a highly sophisticated investor and the grounds that he is alleging form the basis of the breach of contract were and are public information that has not materially changed nor been alleged to have materially changed since the signing of the merger agreement. Moreover, and most…

No post body was provided.

Re: Notice of termination of Twitter merger agreement

#895

Post by nabla9 »

ergocoder wrote: post #863
suzzer99 wrote: post #699

Earlier quoted context omitted.

Do they always have the option of settling at any point in the process? Like if Musk said "$20 billion penalty but I don't buy the company", I assume they'd say yes? (Or substitute a bigger number if not.) So are they just negotiating at this point if Musk has a penalty number he's willing to pay?

My bet is on this. They will just negotiate. Nobody wants to go through a lengthy legal process. I think the number will be at 5b. Because, at 5b, Twitter gets a 1y revenue for virtually no cost. Twitter doesn't want to sell to a buyer who doesn't actually want to buy. It's not good for anyone. Imagine Musk buying Twitter and starting open up exec emails knowing about the bot numbers being inaccurate.

> Twitter gets a 1y revenue for virtually no cost.

This is not between Twitter and Musk. This is between Twitter shareholders and Musk. Twitter board is just working on their behalf. Shareholders don't care about Twitter's future now when they have very tight agreement. There will be judgement against Musk almost certainly.

Musk made $44B deal. However this ends, Musk is in hook for tens of billions. Either he pays $44B and gets Twitter or he pays the difference between $44B and current valuation when the deal is made, say $20B and current owners keep Twitter.

Musk has no upper hand. He made a huge mistake.

Re: Notice of termination of Twitter merger agreement

#896

Post by JamesSwift »

aeternum wrote: post #599
tptacek wrote: post #93

Earlier quoted context omitted.

This argument is a sleight of hand. Nobody has claimed that Musk waived his right to information from Twitter. What he waived was his right to diligence, which is the right to information along with the discretionary right to terminate the deal based on it . What he waived was the ability to do anything with the information absent an (impossible to obtain) MAE discovery. The obvious legalese thing to do in Musk's buy…

Instead of all this interpretation you're posting, why don't you post the actual language of the deal so people can decide for themselves?

https://www.sec.gov/Archives/edgar/data/0001418091/000119312...

Copying a previous reply I've made on this:

Section 5.11 ("Parent" and "Acquisition Sub" is Musk, "Company" is Twitter):

> Each of Parent and Acquisition Sub has conducted, to its satisfaction, its own independent investigation, review and analysis of the business, results of operations, prospects, condition (financial or otherwise) or assets of the Company and its Subsidiaries. In making its determination to proceed with the transactions contemplated by this Agreement, including the Merger, each of Parent and Acquisition Sub has relied solely on the results of its own independent review and analysis and the covenants, representations and warranties of the Company contained in this Agreement

So, in essence:

1) Musk has been afforded the opportunity to address any concerns he has with Twitter

2) Any concerns of Musks have been satisfactorily resolved by Twitter

3) In determining said satisfaction, Musk is relying on his own judgement and analysis, and is not relying on any analysis by Twitter.

Re: Notice of termination of Twitter merger agreement

#897

Post by Forgeties79 »

encryptluks2 wrote: post #785
nolok wrote: post #773

Earlier quoted context omitted.

In a way, Twitter played Musk's ego to perfection and he didn't see it until its too late. In fact I'm not sure he even admits it to himself yet.

Musk played everyone. I called it as soon as it was announced that he was just manipulating the markets. Hopefully SEC actually does something for once.

>hopefully the SEC actually does something for once

They can’t when people like Musk are allowed to rip the few teeth they have out any time they try to hold wealthy individuals/companies accountable. Jon Stewart did a really interesting interview with a former SEC chair few months ago (“The Problem with Jon Stewart”), and while Jon clearly clearly tells him to not pass the buck/not make excuses, it’s also clear to him that the SEC is outgunned and a serious example of regulatory capture.

They can’t throw money at the problem, they can’t get clever or they’re sued for being “out of bounds,” and they’ve been successfully demonized to the public, so they have no support virtually anywhere.

It’s like the whole “tax the rich” battle cry. We won’t see it happen so long as the IRS is considered borderline an enemy of the people, because who could ever campaign on “increase funding for the IRS so they’ll be better at collecting taxes”?

Re: Notice of termination of Twitter merger agreement

#898

Post by Lazare »

fortran77 wrote: post #652
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…

I agree with your analysis, but I also think the numbers are bogus. Just for fun I tried buying half a million followers from some Russian guy a 7 years ago. While that number declined a bit over the years as Twitter did some trimming, I still have half of them. (Interesting some of the followers were "real" in that these were people who installed a program that ostensibly would tell them who recently followed or unf…

That's an interesting story, but irrelevant to this.

Twitter claims that That there are a lot of bots on Twitter is well known, and clearly true. That Twitter happily leaves most of them alone to do their own thing as long as they don't abuse the service is also well known, and quite sensible.

The question is whether Twitter is good about flagging them as bots. You could have a million bots following you, but as long as Twitter has correctly noted them as bots and not counted them as mDAU, then exactly 0 count as part of the 5% bots.

Nobody outside of Twitter knows who they are counting as part of their mDAU, which means nobody can cross check their numbers.

Re: Notice of termination of Twitter merger agreement

#899

Post by starkd »

hermanradtke wrote: post #537
starkd wrote: post #501

Earlier quoted context omitted.

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…

He didn’t waive due diligence. He chose to forego any due diligence before making an offer. This isn’t like buying a house…

Oh? This is news to me. The media are all claiming he waived it, though I tended to doubt it. That he would waive it does seem kind of odd, since even waiving due diligence should not absolve a company from lying about its assets if found out.

Re: Notice of termination of Twitter merger agreement

#900

Post by ceejayoz »

peanuty1 wrote: post #796
ceejayoz wrote: post #347

Earlier quoted context omitted.

There’s a chance Twitter accepts 5-10B in exchange for dropping their objections to the end of the merger.

Why would they take a 5B settlement when they have legal grounds to force the deal through for 44B?

Because there’s always the chance you lose in court, and years worth of nasty litigation is distracting and unfun.
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