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Elon Musk makes $43B unsolicited bid to take Twitter private

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Re: Elon Musk makes $43B unsolicited bid to take Twitter private

#981

Post by bjornsing »

DelaneyM wrote: post #691
gunapologist99 wrote: post #521

So Twitter was at $70 per share a year ago. So what? Jack Dorsey was CEO a year ago, too. The share price was $33 less than a month ago. But, despite an absolutely incredible roller-coaster news cycle, things have been definitely trending down at Twitter ($33/share last month), which was reflected in its share price. The current executive team (and Dorsey) had wasted time focusing on things that didn't matter instead…

Everyone currently holding $TWTR believes that the true value is greater than the current price. To make a successful hostile bid, you need to pay not just "more than the current price", but "more than the holders of 50% of current shares believe the company to be worth". Usually bidders use analyst price targets to guess at the distribution of holders' internal price targets. This is what makes it so difficult, and…

You explained it perfectly, no white board needed.

I can only add one minor point from a general and international perspective: 50% may not always be enough. At least in Sweden I think you need 90% to accept a bid before you can legally force the remaining 10% to sell their shares. Even if you accept that there will be minority shareholders you will need 67% before you can do some things, like e.g. issue new shares without giving minority owners right of first refusal.

I'm sure there's a lot of devils in the details all over the world, and I'd be surprised if there are none in the US.

Re: Elon Musk makes $43B unsolicited bid to take Twitter private

#982

Post by unicornmama »

yabatopia wrote: post #383

Let's ignore personality and societal issues for a moment and look at the value proposition. The 'best and final offer' of $54.20 per share is just too low to be acceptable for major investors. Just over year ago, Twitter shares traded at about $70 per share. Musk's offer is about 25% lower than last years peak. There's no reason to assume Twitter shares can't reach the same levels ever again, nothing much has change…

That’s not how market valuation works.

You’re worth your share price today. Not what your share price was last year. Not what you think your price should be.

> current major investors will probably want to unlock that value themselves.

This isn’t how risk or portfolio allocation works. Musk has offered current investors $43 billion as risk-free guaranteed cold hard cash. Depending on their portfolio and risk allocations they may prefer the $43 billion today instead of an uncertain chance at the future. And to take that cash and diversify in alternative endeavors.

Re: Elon Musk makes $43B unsolicited bid to take Twitter private

#985

Post by xutopia »

thepasswordis wrote: post #249

Can anybody make a good argument as to why Twitter (in its current form) isn’t a major detriment to society? If Twitter poofed out of existence today, it would be a major win for this planet. People talk about a frightening future with a human hostile AI that wants to destroy humanity. That exists, it’s twitter. Elon buying it, even if he runs it into the ground is a good thing. Getting rid of some of the hostile AI…

In some parts of the world Twitter has been used to overthrow governments and bring democracy. Check the article on Wikipedia regarding the Arab Spring and how social media played a role. https://en.wikipedia.org/wiki/Arab_Spring

Re: Elon Musk makes $43B unsolicited bid to take Twitter private

#986

Post by ErikVandeWater »

DelaneyM wrote: post #691
gunapologist99 wrote: post #521

So Twitter was at $70 per share a year ago. So what? Jack Dorsey was CEO a year ago, too. The share price was $33 less than a month ago. But, despite an absolutely incredible roller-coaster news cycle, things have been definitely trending down at Twitter ($33/share last month), which was reflected in its share price. The current executive team (and Dorsey) had wasted time focusing on things that didn't matter instead…

Everyone currently holding $TWTR believes that the true value is greater than the current price. To make a successful hostile bid, you need to pay not just "more than the current price", but "more than the holders of 50% of current shares believe the company to be worth". Usually bidders use analyst price targets to guess at the distribution of holders' internal price targets. This is what makes it so difficult, and…

You'd have to be really damn sure that Twitter is worth more than what Musk is paying.

It's hard to see how an owner of Twitter stock could rationally reject an offer with a guaranteed +38% return. For any serious investor, even if they believe Twitter is worth twice what it is now, they must have several other stocks they believe are also worth twice what they are now. And if Elon bought all of them out at +38% returns, that would be a tremendous year investing.

Re: Elon Musk makes $43B unsolicited bid to take Twitter private

#987

Post by shoulderfake »

hintymad wrote: post #546
paganel wrote: post #50

I personally think this is excellent, in the great scheme of things, maybe this will open a real discussion about the real oligarchic nature of the US political and societal life at the top. I mean, with tech titan (and second wealthiest man on the planet) Bezos owning the WaPo, the moment the tech titan (and the wealthiest man on the planet) Musk will put his hands on Twitter hopefully will also be the moment of som…

As much as I don’t like WaPo’s Opinion columns and Twitter’s double standards in content moderation, I don’t think the two companies are puppets of their owners. The staff there have their mostly left-leaning political view point and their own moral standard. I don’t necessarily agree with their view, but it’s their view and their voice nonetheless.

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