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> "if my offer is rejected i will reconsider my ownership in twitter." Thats an immense amount of selling pressure on the stock... This is a threat. He's negot
by RustyConsul 4y ago
> "if my offer is rejected i will reconsider my ownership in twitter."
Thats an immense amount of selling pressure on the stock... This is a threat. He's negotiating with a gun to their head.
- schainks 4y agoThey don’t call it thirsty Thursday for nothin’!
- ryanSrich 4y agoSeems like an amazing move by Elon. Buy a sizable portion of the business to hold hostage, and then make the company an offer that they essentially can’t refuse because of fiduciary responsibility. If they reject Elon’s offer the stock price will sink like a rock. They pretty much have to take it.
- wavefunction 4y agoOr the SEC could finally go after Elon for market manipulation. There's always options.
- tonetheman 4y agoTHIS THIS THIS. It is absolutely illegal what he is doing.
- musingsole 4y agoHow? The laws absolutely allow for hostile takeovers. If Twitter gets to determine what to censor because it's a corporation, well, they get to get bought like one too.
- systemvoltage 4y agoThe mental gymnastics going on in this thread is crazy. Let's separate two concerns: 1) Belief system – whether you philosophically support Elon's take over or not 2) Objective facts, corporate finance and legal aspects of what's going on All I can see in this thread is 1) masquerading as 2).
- TMWNN 4y ago>All I can see in this thread is 1) masquerading as 2). Indeed. One would have hoped that Hacker News would be immune from Reddit/Twitter-style "Anything I don't like is illegal/unconstitutional", but apparently not. "Someone buying up shares of a company before he announces a hostile takeover is inside information and thus illegal!" Good grief.
- lcrmorin 4y agoDepends if the offer is made in good faith. If not, this would really look like market manipulation.
- excitom 4y agoWait, aren't you aware of the "It's not illegal if a billionaire does it" rule?
- Majestic121 4y agoBillionaire or not, what is illegal in his move ?
- metamet 4y agoThat is a great question and I wonder the same thing. "I am going to dump 1/10th of the company that I very publicly acquired if they don't do what I want them to do" feels like manipulation since he's controlling the value of such a large amount of it. But is it illegal to be willing to lose money if a threat isn't met? Furthermore, would it be illegal for him to dump his shares, allow the trajectory to tank the price further, then rebuy when it bottoms, rinse and repeat?
- meatsauce 4y agoThat's called a hostile takeover. Part of being a public company. No, you are allowed to sell your shares if you don't want them anymore.
- l33t2328 4y agoIt’s not illegal to say “I want to buy more shares at what I believe to be a generous price. If the board won’t sell me these shares, I don’t trust the judgement of the board and will subsequently sell my existing shares.”
- zwily 4y agoNo it's not.
- deleted 4y ago[deleted]
- pid-1 4y agoThis amazing move is considered a form of maket manipulation in my country. Not sure about US stock markets.
- leereeves 4y agoWhat law forbids offering to buy a company?
- eatsyourtacos 4y ago'Knowing' you will put an offer to buy a company is insider information. The assumption here is he has been acting on this information recently and it was part of his plan. Unless you think he just woke up today and said: You know what, I'm going to buy Twitter! Which, I mean.. given Elon maybe that's what happened. But if it was premeditated then he has clearly been acting on insider information.
- deleted 4y ago[deleted]
- xiphias2 4y agoI can assure you that the CEO and the board has much more insider information than Elon.
- eatsyourtacos 4y agoDuh, but they are not acting on the insider information. Elon is. He bought shares, then put in an offer which drives his existing shares up. Perhaps you can argue until he sells them he isn't acting.. perhaps.. but if he sells them today, are you still telling me he isn't acting on insider information?
- xiphias2 4y agoFrom the SEC website: Who is an insider? An “insider” is an officer, director, 10% stockholder and anyone who possesses inside information because of his or her relationship with the Company or with an officer, director or principal stockholder of the Company. A principal shareholder is a person that directly or indirectly owns or controls more than 10% of any class of voting shares or securities of a company. The principal shareholder has the authority to vote using those voting shares. Elon has less than 10% share (9.2%), so he's not an insider. Probably he stayed under 10% because of this law.
- eatsyourtacos 4y ago>Seems like an amazing move by Elon You and I have very different definitions of the word "amazing"
- colechristensen 4y ago> amaze (v.) > "overwhelm or confound with sudden surprise or wonder," 1580s, back-formation from Middle English amased "stunned, dazed, bewildered," (late 14c.), earlier "stupefied, irrational, foolish" (c. 1200), from Old English amasod, from a- (1), probably used here as an intensive prefix, + *mæs (see maze). Related: Amazed; amazing. "amazing" never meant "this is of surprisingly high quality and good"
- UrsaMedius 4y agoIt means that today.
- colechristensen 4y agoYou say, in response to somebody using it to mean something else. There is a strange circular logic to saying words mean something new because they are commonly used in a new way and at the same time telling somebody how they're using a word is wrong because it doesn't match this new meaning.
- robonerd 4y agoJustifying a prescriptive attitude with descriptivist arguments is farcical.
- fluster 4y agoHere's another dictionary (https://www.lexico.com/en/definition/amazing https://www.lexico.com/en/definition/amazing): 1. Causing great surprise or wonder; astonishing. 1.1 [informal] Startlingly impressive Did pointedly ignoring common usage add anything here?
- 4y ago
- dkjaudyeqooe 4y agoThat's not how it works, the board would look at the long term value of the company, not the current price or what it will be in the next few weeks if Elon sold. For instance Twitter stock was $60 last october, if they didn't ask for at least that it would be shortchanging shareholders and also imply a declining company.
- xwdv 4y agoWe will never see those prices again. They occurred during overvalued and speculative market conditions and we will not return to that for several years, if ever.
- mrleinad 4y agoTwitter stock price target for financial institutions is 30 dollars. They're shorting it, and giddy about the board rejecting Elon's proposal.
- fastball 4y agoYou don't need an implication of decline when the market has already explicitly indicated it believes Twitter is declining as evidenced by the falling stock price.
- outside1234 4y agoNo, if they reject it, they will just ask for something like $80 a share and say that that is what they feel is the true value.
- kadomony 4y agoAmazing? This is exactly the type of move I'd expect from someone like Elon who lacks empathy. He is a sociopath. The fact that a sociopath wants to be a king of social media is disturbing.
- tomlin 4y agoWow. This community isn't what it used to be. Sociopath? Don't you think you should validate that claim? This isn't a reductive Hasan Piker stream.
- pram 4y agoI'm amused you think sociopaths aren't already the kings of social media.
- meatsauce 4y agoThose poor sociopathic one-party state marxists at twitter "trust & safety." Once Elon has full control of Twitter, they can always leave and go start their own platform.
- fastball 4y agoWho exactly is Musk demonstrating a lack of empathy for in this situation?
- hypersoar 4y agoIt doesn't take a genius to arrive at this strategy. Just tens of billions of dollars.
- Melatonic 4y agoHopefully your correct and Twitter tanks and maybe we can finally be rid of this crap I don't hate Twitter like I hate Facebook (mainly for ideological reasons and their propensity for exploitation) but god damn is their interface and entire product model annoying.
- tiahura 4y agoThat’s what every corporate raider hostile takeover attempt does. If the board won’t do what the pursuer thinks is best, why would they continue to hold the company?
- thebradbain 4y agoI read it as a threat too... is it not against the SEC's rules for market manipulation?
- no-dr-onboard 4y agoCertainly someone out there agrees with you. Realistically, a lawsuit would certainly quell the interest in this and drag this issue into relative obscurity over the course of years. Timeless tactic.
- colechristensen 4y agoIt is almost certain that whatever happens, there will be a lawsuit. Suing twitter, the board, elon, maybe the SEC (possibly multiple in different directions). It happens with almost any large move where there is even a hint that something happened incorrectly.
- rrdharan 4y agoMore like it happens with any large move period, no hints needed, because the expected value payoff of a lawsuit in that case typically makes it a worthwhile exercise.
- Hamuko 4y agoMusk being known as a long-time fan of the SEC with a respect for their rules.
- deleted 4y ago[deleted]
- coffeeblack 4y agoHow so? He is even giving more information about his future intention than he had to.
- 4y ago
- ncmncm 4y agoTo me, the main message is that he wasn't really serious about Mars at all, or even about SpaceX, or Tesla -- never mind global climate catastrophe. Were I a Twitter stockholder I might perceive a different emphasis.
- golemotron 4y agoIf your bar for "serious" doesn't allow for multi-tasking.
- ncmncm 4y agoMoney is fungible. Every single dollar that goes for Twitter is exactly a dollar that does not go for what he used to say was important. He might be heard to say those again, but dollars speak louder than words. Musk can say anything, anytime. What he does with his money demonstrates what he believes.
- golemotron 4y agoRecipe for not thinking anything is important: split your holdings into two investments.
- ncmncm 4y agoRecipe for thinking two things are equally important. If one of those is as intrinsically unimportant as Twitter, the other is too.
- boppo1 4y agoMaybe he sees twitter as a threat to his other goals? 'Whitey on Mars' could be very compelling to the twitter crowd.
- ChadNauseam 4y agoLike it or not, Twitter is extremely important. It sets discourse and gets politicians into office. Remember how much Trump's tweeting dominated the news cycle? Elon buying Twitter isn't him saying he thinks it should be important, just that it is.
- hayd 4y agoIt's a hostile take over.
- joshlemer 4y agoI think calling it a gun to their head is a bit over dramatic.
- tomlin 4y ago
- aspenmayer 4y agoCanadian you mean.
- qsdf38100 4y agoWhat does it take for you to see someone as a threat ? A compulsive liar throwing 43000000000$ to take over one of the largest social network in the world, grossly pretending it’s for "free speech"? And people on HN are buying it? Hmmm.
- tomlin 4y agoYou clearly have an axe to grind moreso than an actual point. In this community, if you declare someone as a liar, you generally have to provide some proof of that. This isn’t a « my feelings » community. Twitter is literally ruining the world. Donald Trump was elected because of it. I’m sorry, but Twitter could not get any worse. I fully support the purchase. Anyone who’s actually watching what’s going on do, too. You’re just going to have to deal with it, albeit, while spewing fear mongering pretending to be concern. Reductive childlike reasoning might work on Hasan’s millionaire stream, but not in reality.
- anonu 4y agoOn the other hand - the stock was flat over the time that he bought... So not in total agreement with you on the stock impact of his selling. It seems like the only impact is the headline risk - and not so much actual selling pressure.
- leereeves 4y agoIf the stock was flat while Elon was buying almost 10% of the company, it probably would have declined quite a bit if he hadn't been buying, because the people who sold the shares Elon bought would have been looking for other buyers.
- anonu 4y agoSomeone can do a basic quantitative analysis. He started buying March 1 (?) I believe. This date is public in last filing. You can estimate the historical beta, and get TWTR return and market return in March. My quick analysis was that in the absence of any other news, his buying really had no serious impact.
- dkokelley 4y agoI think he started March 14th based on trading volume. Goes from ~15M/day to 35M/day for the next few days before settling down. (Made another comment elsewhere on this) https://www.sec.gov/Archives/edgar/data/1418091/000110465922041911/tm2211482d1_sc13g.htm https://www.sec.gov/Archives/edgar/data/1418091/000110465922...
- anonu 4y agoOk so assuming march 14 to April 1. The market was up 8% over that time and TWTR was up 19%. Beta is 1.3 so with a beta adjustment the excess return from musk's buying is about 19-(8*1.3)=8.6%. Is this a lot or a little impact for buying close to 10 percent of a large cap stock? It's hard to say. I'd say it's a bit lower than i would have expected. Nonetheless, it provides somewhat of a floor if musk decides to sell his stake. Edit: https://www.sec.gov/Archives/edgar/data/0001418091/000110465922042863/tm2211757d1_sc13d.htm https://www.sec.gov/Archives/edgar/data/0001418091/000110465... Musk bought between Jan 31 and April 1. Market was up 2.8% and Twitter was up 11.5%. So the impact was less. 7.8% beta adjusted.... Really not much...
- m3kw9 4y agoIt will hit back at 40$ is as if the Elon pump never happened, is that so bad? However, it does create pressure from “activitists” to sell to Elon. The main thing is: Is Elon a good leader for Twitter. There is a lot of positives because Elon has already proven himself in multiple companies, plus he understands Twitter as much as anyone from his use of it
- whatshisface 4y ago>Is Elon a good leader for Twitter. Since there would no longer be any public investors in Twitter after this, that does not actually matter as far as the present investors are concerned.
- babypuncher 4y agoHis absolutist "free speech" attitude would absolutely be horrible for Twitter. There would be literally nothing to stop bots and state-sponsored messmakers from completely gaming Twitter far beyond what they already do today. I think a lot of people do not realize the can of worms they are opening when they advocate for zero moderation on a platform as large as Twitter.
- eggy 4y agoLike how Twitter memory-holed the NY Post/Biden Laptop story? Yeah, moderation, sure.
- nomorecomp 4y ago
- coolso 4y agoIt wasn’t given scrutiny. It was silenced. And, turns out it wasn’t misinformation either. Thank God with Musk’s new Twitter we won’t have to have this sort of discussion anymore anyway, people won’t be able to just shout Russian disinformation at anything that makes the left look bad and have Big Tech scramble to do their bidding to help influence elections.
- williamsmj 4y agoThis is standard operating procedure for takeovers, but I think you're massively overestimating the amount of pressure someone selling 9% of the company places on the stock price. Someone buying 9% (with an expecation that they would buy more) moved the stock $10. The same person selling 9% stock (with no possibility that can sell more) is unlikely to move the stock more than that.
- sanedigital 4y agoTwitter is selling at $45, a $10 move is 22%. That's insane pressure.
- williamsmj 4y agoI think you should look at the historical volatility of TWTR before calling a 22% move "insane pressure". It's also worth noting that the stock price is almost unchanged today as of this writing, which tells you that the market thinks he's not serious, or his lowball offer is going to be laughed out by the board, which significantly reduces the amount of "insane pressure" he's exerting.
- llbeansandrice 4y agoWhat does historical volatility have to do with it? If Elon can basically manipulate his investment into a 22% return why on earth wouldn't he do that? A single person able to pressure a single commodity to the tune of 22% is bonkers. I'm not debating whether that will happen, just contending your first statement.
- infofarmer 4y agoIt's not just any single person.
- williamsmj 4y agoI agree it's bonkers that this is possible. I agree, in an environment where the SEC seems unable to stop him, Elon Musk might well consider 22% return worth doing. None of that is relevant to the point I'm making. I'm contending the claim that the implicit (and completely pro forma!) threat in his SEC filing places "insane pressure" on the Twitter board. The the possibility of a 20+% stock price change will not play a large part in their calculations. It's just not a big deal in the context of such a volatile stock.
- FormerBandmate 4y agoThat would mean that management effectively wins, the stock would go down but they wouldn't have to worry about the threat of Elon Musk looming over them and the crisis would be solved. It doesn't make any sense from a takeover perspective, if I was Parag that would make me feel more comfortable rejecting the offer.
- jollybean 4y agoElon Musk is not important to Twitter. It's a toy gun pointed at their head. He could maybe maybe start a competitor, but I doubt it would work. 1) He doesn't have the energy for another serious project 2) It would end up being something else, which frankly might be welcome, but it won't replace twitter. Journalists etc. around the world are not going to flock to a 'free speech' platform with little moderation. They 10x will not do it if Trump is on it, and gaining traction, for example.
- partiallypro 4y agoJournalists thrived when Trump was still on Twitter. It was nightly news and they all RTed him constantly.
- jollybean 4y agoThe media benefited from Trump in that audiences were bigger, but they don't like him. They won't validate a new project by their presence if he is involved. People avoid Trump's 'truth' platform because they don't want it to have a critical mass of legitimacy. If 50% of people, and 75% of public voices who despise Trump stay off the platform, it cannot develop a critical mass.
- partiallypro 4y agoTrump himself has never even used the Truth platform. I never said the media "likes" Trump, but they profited from him greatly, he's actually great for business (and arguably great for Democrats.) If Trump were allowed back on Twitter, journalists would decry it for a while and then embrace their renewed social interaction numbers. Outrage is a big seller and when everyone is pissed about something it generates a lot of revenue/clicks/interactions for these media organizations.
- jollybean 4y agoOh yea, I agree with that, I was just indicating that most of the industry is going to avoid him for now for reasons that arguably go against their own bottom line.
- jslaby 4y agoThe price is currently $46 and considering the stock market is down as a whole, the $54 price will easily be eclipsed in the near future imo. Granted Musk will sell his stock and that price will go down, but I would balk at this offer if I had any skin in the game.
- gpm 4y agoIf you're basing this on the stock market as a whole being down, surely you'd make more money by selling to Elon at $54 while it's still down, and re-investing your money in other stocks - letting you get the upside twice, once from Elon and once from the stock market going up.
- snarf21 4y agoI hope the short sellers who have a long standing hatred of Musk short the hell out of Twitter and make a ton when this offer is rejected.
- furyofantares 4y agoI'd expect the more they short it, the more likely it is to be accepted.
- deleted 4y ago[deleted]
- qsdf38100 4y agoI can’t see how his plan isn’t about getting trump back on twitter. He will do a lot of smoke screen speech, telling contradictions and unclear bold statements. But in the end I bet all of this will end in removing trump ban. If I’m right, it’ll confirm that musk is just a fascist greedy sociopath disguised as a tech enthusiast.
- coffeeblack 4y agoNot a threat. If Musk can’t fix Tw, then the share value will further decrease, so it’s just rational for him to then sell. And good for him to be honest about it from the start.
- nonethewiser 4y agoSelling shares is putting a gun to their head?
- joshspankit 4y agoAs another commenter pointed out: It’s Elon Musk. While selling all his shares would make the price dip short-term, no one who knows his tactics will take that as a serious commentary on the viability of Twitter itself.
- trixie_ 4y agoYea people don't understand he has too much money to care about playing games and pumping/dumping shares. He basically can't take a breath without 'manipulating' the stock price of something.
- xyst 4y agoCorporate raiders did this all the time. Just look at the history of Carl Icahn in the 1980s.
- lprd 4y agoYou've omitted some details: d. If the deal doesn’t work, given that I don’t have confidence in management nor do I believe I can drive the necessary change in the public market, I would need to reconsider my position as a shareholder. i. This is not a threat, it's simply not a good investment without the changes that need to be made. ii. And those changes won't happen without taking the company private. https://www.sec.gov/Archives/edgar/data/0001418091/000110465922045641/tm2212748d1_sc13da.htm https://www.sec.gov/Archives/edgar/data/0001418091/000110465...