7 ms·

So, I'm not very corporate savvy and this might be a very stupid question. Is there a NON-culture/political reason for all the push back against Musk buying Twi

So, I'm not very corporate savvy and this might be a very stupid question. Is there a NON-culture/political reason for all the push back against Musk buying Twitter? From the read, this just seem to be opening the door for someone else to try and take majority control and pining away for the days of Dorsey (which, if looked at objectively, weren't great... just filling an opportunity).

paxys 5y ago
As a shareholder, either you are happy with the price Musk is offering you, or you think the company can do even better long term. Twitter is clearly a very valuable asset, considering this fight is happening in the first place, so it is not inconceivable that >50% of shareholders will want a larger buyout. Heck even if you are completely happy with the terms, pushing back and asking for more is a standard negotiation tactic. They'd be foolish not to try.
axg11 5y ago
The pushback is simple: Twitter stock price was higher than Musk’s offer for most of 2021. We are in a downturn affecting the entire tech industry, and it’s likely that prices will return to previous levels at some point. Elon’s offer is a lowball and Twitter can bring more value to shareholders with or without Elon.
- dnissley 5y ago
  Counterpoint: it's not a downturn, just a return to reality. Tech stock valuations were sky high in late 2020 / early 2021, and even considering recent drops most are still above their pre-pandemic levels.
  - mdasen 5y ago
    Totally possible, but the original question was "Is there a NON-culture/political reason for all the push back" and "Twitter stock price was higher than Musk’s offer for most of 2021" is definitely a non-cultural/political reason to push back on the offer. Again, you might be right that Twitter's price was over-inflated in 2021, but "it was worth more" is certainly a non-cultural/political reason to push back on the offer - even if they're wrong about Twitter's long-term value.
- hajile 5y ago
  Their stock dropped along with Facebook and other media platforms the second Apple stopped them from tracking users everywhere. That's without mentioning the crazy overvalue problem such companies already have.
- defen 5y ago
  > We are in a downturn affecting the entire tech industry, and it’s likely that prices will return to previous levels at some point. So why not take the offer (which is 20% higher than the current market price for the stock) and put the received cashed into other tech stocks? Is Twitter uniquely/excessively down compared to other tech stocks, and due for a bigger rebound?
  - pm90 5y ago
    Because Twitter is not a hedge fund.
    - gitfan86 5y ago
      Twitter wouldn't exist in this scenario from the stock holder's perspective. They would get cash and then put that cash into other investments of their choosing. The only way this makes sense is if there is a bigger offer incoming OR if the Twitter board has a plan to make twitter much more successful in the near term and succeeds at that plan.
      - myvoiceismypass 5y ago
        I think the "not a hedge fund" part is referring to the fact that this would be a taxable event for the average stockholder. You can't just presto move that same amount into another tax stock.
        lupire 5y ago
        No, they meant that Twitter is a specific business that shareholders believe in, not just a financial vehicle. Like part of the value of your house is that it is your home, not just a liquid investment. Taxation is only a concern for folks who have big unrealized gains and lack harvestable unrealized losses.
  - hedora 5y ago
    If this leads to a shareholder lawsuit, the board may need to argue they had non public information suggesting the stock was undervalued. At that point, they'll need a good lawyer to explain why Twitter chose to omit that information from their SEC filings.
- FFRefresh 5y ago
  I don't immediately buy the logic of "Stock A hit a peak of $X last year, therefore that is the correct price/valuation, and not the lower price it is right now" If Twitter was worth more, it'd be worth more. With that logic, you should put a huge chunk of your savings into Twitter to benefit from the insight, as it's currently trading at 39% below its 52-week high.
  - soneca 5y ago
    The argument is not that is worth more, it is that it can be worth more in the future than Musk offer. No one can predict the future, but it is a legitimate reason to believe it can be worth more than $54 in the future and pointing that it was worth more last year is just an argument for the belief. Which makes sense to me. As legitimate as it is to believe that the stock price will never again reach $54.
    - alephnan 5y ago
      > The argument is not that is worth more, it is that it can be worth more in the future than Musk offer. Then it should be priced for discounted future cash flow and value.
      - parineum 5y ago
        The disconnect between you two seems to be an understanding of what the price of a stock means. The stock price today represents what investors think the future value might be. The speculation that the dip will bounce back is built into today's price. The reduced price over the high represents the perceived risk that it won't return. Musk values the stock higher than the mean investor.
        thisismyswamp 5y ago
        *higher than the highest-valuing person currently in the bidding list
  - georgeglue1 5y ago
- minhazm 5y ago
  In 2016 Microsoft acquired LinkedIn at a $26 billion valuation, which was at the time a premium of ~40% or so over the current price, but still lower than their valuation was the previous year. So it isn't unprecedented to accept an offer for an amount lower than your all time high Elon's offer is a 38% premium over the price it was prior to him disclosing his position in the company. > We are in a downturn affecting the entire tech industry Some companies are down more than others, and some are doing fine. Twitter revenue is largely driven by ads and they are likely also going to be hit by Apple's privacy changes like all other ad based businesses. Meta (Facebook) has already said they expect ~$10 billion revenue hit from the changes. It's feasible to think that Twitter revenue for the year may actually drop and the stock price may not recover to the 2021 levels any time soon.
  - pm90 5y ago
    IIRC The Apple privacy changes hit a very specific kind of targeted advertising that Facebook was great at monetizing. I’m not familiar with Twitters ad platform but it’s unlikely to have affected them as hard as they hit FB.
- moralestapia 5y ago
  >Twitter stock price was higher than Musk’s offer for most of 2021. That's cute but the past is gone. Twitter is clearly going downhill, both with their product and with their management (good thing they got rid of Dorsey, but perhaps that was too little too late), the stock just follows on that. If anything, people like Musk are the ones who still attract interest to the platform. >Twitter can bring more value to shareholders with or without Elon Twitter is on a very dangerous spot right now, their MAUs peaked long ago as young people go to other platforms, and overall, everyone is a bit of tired of the kind of discourse that predominates there, for instance, Trump was banned and I STILL find out everything about him because the people there (left and right-wing) are absolutely obsessed with him. Honestly, Twitter is the one social media platform that I wouldn't really mind if it just disappeared. At least Facebook has some family members in there and some pictures from my earlier years. Twitter brings nothing of value to my life and I'm sure I'm not the only one who feels like that.
  - lupire 5y ago
    If Twitter allegedt failing didn't bring the stock price down before, why would it now? Trump is mainstream. MSM covers him, as do Reddit and Facebook posters.
- coolso 5y ago
  The high price was due to COVID and everyone being stuck inside. That’s over now and has been for some time.
- sakopov 5y ago
  It seems a little funny to me that people flock to the idea that Twitter's market cap in a fed-fueled stock market when literally everything was moving up is some kind of true valuation for Tiwtter. If anything Twitter is likely trading at or very close to its fair value now then it was last year when retail was throwing money into anything.
  - mcintyre1994 5y ago
    I think the argument is that if long term holders wanted to sell at this sort of valuation then they would have last year when it was way higher. If there was a bunch of retail money fuelling it then they could have took advantage and got out but they didn’t. So why would they sell now for a smaller upside?
  - WanderPanda 5y ago
    Gamestop is still at 150 so people are still throwing money into anything
    - lupire 5y ago
      GME is a bit weird because it was essentially a crowdsourced fundraising round for Ryan Cohen SPAC, expecting an NFT play. (Which I expect will fail spectacularly)
- jokethrowaway 5y ago
  2021 was a growth without fundamentals for the entire market, mainly funded by currency inflation and government influence. This bear market is returning to reality and paying the price for those profits.
- harambae 4y ago
  > and it’s likely that prices will return to previous levels at some point Wow, that's great news for Velodyne Lidar -- currently trading around $2 and was $28 less than 2 years ago. (Why bother with paltry 2x return on Twitter when you could get a 14x return?)
FFRefresh 5y ago
Surely there is both a status quo and survival bias going on with the existing leadership/management team. When you have an outside person who wants to change some fundamental things about the company, it seems natural that there would be resistance. As an outsider, I'm personally intrigued by the prospect. There are two things he's mentioned that I think could be very beneficial (outside of freedom of expression) to society: 1. Transparency - open sourced algorithms for what shows when and transparency about moderation decisions 2. Reduced short-term financial incentives - Given it'd be bank-rolled by someone with a lot of money and private, they wouldn't need to play the gray area game of increasing advertising & data sharing that other sites do.
systemvoltage 5y ago
The sad truth is that this is an intense political battle. I would personally favor Elon Musk taking over and shaking things up, any other position is untenable. And, I am saying this as a progressive. I think an open and transparent social platform would be great for the society. The issue is that managerial class of America, both in private and public sector, are in bed with each other. The government cannot suppress free speech using the frontdoor, but these social media companies (Meta, Twitter) as well as Big Tech machinery (Google, Apple, Microsoft, Amazon) act as a proxy for supressing political speech through opaque algorithms and straight up censorship. We, liberals, used to be exceptionally devoted to free speech. Just look up ACLU's cases from the 90's and prior. We were against the establishment. Against the managerial class crushing labor. Against the fucking 3 letter agencies. Now, my own party wants to turn America into an authoritarian censorship dystopia. It's hard to stand by that.
- binarray2000 5y ago
  Just as the Republican Party has been taken over by neocons, the Democrat Party has been taken over by neolibs. They both have the same ideas and are never on the oposite sides. That is why you see endless and meanilingless wars, media conglomerates, censorship, billionaire-class, 3-letter-agencies off the leash, workers in diapers.
- deleted 5y ago
  [deleted]
- celdon25 5y ago
  > Now, my own party wants to turn America into an authoritarian censorship dystopia You could start by lobbying to force tech companies over a certain size to disclose reasons for users or content being removed from the platform. The legislation would have to have teeth, naturally.
- aaronblohowiak 5y ago
  Even aclu doesn’t believe in free speech anymore, at least not like they used to
FranksTV 5y ago
Retention of staff. Finding good engineers is exceedingly hard, and I imagine there were rumblings of an internal revolt.
mcintyre1994 5y ago
Against this specific bid: the price is arguably low and holders aren’t likely to want to sell at that price. From Money Stuff: > problem with Musk’s offer is that it is pretty low. Musk points out that $54.20 “represents a 54% premium” over where he started investing in Twitter, and a 38% premium over where the stock was before he announced his position. But Twitter was in the $60s in October, and a lot of its big long-term holders seem unlikely to be sellers at $54.20. “‘No board in America is going to take that number,’ said Jefferies analyst Brent Thill.” Against the bid coming from him: - He famously pretended he was going to take Tesla private and got in trouble because he was pretending. Takeover offers usually don’t have that history I guess. - He doesn’t have financing, not even pretend financing like when he said he was going to take Tesla private
ransom1538 5y ago
"Is there a NON-culture/political reason for all the push back against Musk buying Twitter?" Power. One side wants to have a safe garden where all their thoughts are heard with the other side silenced.
gadders 5y ago
Nope. It's all about people having to protect The Narrative.
incomingpain 5y ago
hogrider 5y ago
Musk is a free speech absolutist so he would lift all free restrictions.

paxys 5y ago

As a shareholder, either you are happy with the price Musk is offering you, or you think the company can do even better long term. Twitter is clearly a very valuable asset, considering this fight is happening in the first place, so it is not inconceivable that >50% of shareholders will want a larger buyout. Heck even if you are completely happy with the terms, pushing back and asking for more is a standard negotiation tactic. They'd be foolish not to try.

axg11 5y ago

The pushback is simple: Twitter stock price was higher than Musk’s offer for most of 2021. We are in a downturn affecting the entire tech industry, and it’s likely that prices will return to previous levels at some point. Elon’s offer is a lowball and Twitter can bring more value to shareholders with or without Elon.

dnissley 5y ago
Counterpoint: it's not a downturn, just a return to reality. Tech stock valuations were sky high in late 2020 / early 2021, and even considering recent drops most are still above their pre-pandemic levels.
- mdasen 5y ago
  Totally possible, but the original question was "Is there a NON-culture/political reason for all the push back" and "Twitter stock price was higher than Musk’s offer for most of 2021" is definitely a non-cultural/political reason to push back on the offer. Again, you might be right that Twitter's price was over-inflated in 2021, but "it was worth more" is certainly a non-cultural/political reason to push back on the offer - even if they're wrong about Twitter's long-term value.
hajile 5y ago
Their stock dropped along with Facebook and other media platforms the second Apple stopped them from tracking users everywhere. That's without mentioning the crazy overvalue problem such companies already have.
defen 5y ago
> We are in a downturn affecting the entire tech industry, and it’s likely that prices will return to previous levels at some point. So why not take the offer (which is 20% higher than the current market price for the stock) and put the received cashed into other tech stocks? Is Twitter uniquely/excessively down compared to other tech stocks, and due for a bigger rebound?
- pm90 5y ago
  Because Twitter is not a hedge fund.
  - gitfan86 5y ago
    Twitter wouldn't exist in this scenario from the stock holder's perspective. They would get cash and then put that cash into other investments of their choosing. The only way this makes sense is if there is a bigger offer incoming OR if the Twitter board has a plan to make twitter much more successful in the near term and succeeds at that plan.
    - myvoiceismypass 5y ago
      I think the "not a hedge fund" part is referring to the fact that this would be a taxable event for the average stockholder. You can't just presto move that same amount into another tax stock.
      - lupire 5y ago
        No, they meant that Twitter is a specific business that shareholders believe in, not just a financial vehicle. Like part of the value of your house is that it is your home, not just a liquid investment. Taxation is only a concern for folks who have big unrealized gains and lack harvestable unrealized losses.
- hedora 5y ago
  If this leads to a shareholder lawsuit, the board may need to argue they had non public information suggesting the stock was undervalued. At that point, they'll need a good lawyer to explain why Twitter chose to omit that information from their SEC filings.
FFRefresh 5y ago
I don't immediately buy the logic of "Stock A hit a peak of $X last year, therefore that is the correct price/valuation, and not the lower price it is right now" If Twitter was worth more, it'd be worth more. With that logic, you should put a huge chunk of your savings into Twitter to benefit from the insight, as it's currently trading at 39% below its 52-week high.
- soneca 5y ago
  The argument is not that is worth more, it is that it can be worth more in the future than Musk offer. No one can predict the future, but it is a legitimate reason to believe it can be worth more than $54 in the future and pointing that it was worth more last year is just an argument for the belief. Which makes sense to me. As legitimate as it is to believe that the stock price will never again reach $54.
  - alephnan 5y ago
    > The argument is not that is worth more, it is that it can be worth more in the future than Musk offer. Then it should be priced for discounted future cash flow and value.
    - parineum 5y ago
      The disconnect between you two seems to be an understanding of what the price of a stock means. The stock price today represents what investors think the future value might be. The speculation that the dip will bounce back is built into today's price. The reduced price over the high represents the perceived risk that it won't return. Musk values the stock higher than the mean investor.
      - thisismyswamp 5y ago
        *higher than the highest-valuing person currently in the bidding list
- georgeglue1 5y ago
minhazm 5y ago
In 2016 Microsoft acquired LinkedIn at a $26 billion valuation, which was at the time a premium of ~40% or so over the current price, but still lower than their valuation was the previous year. So it isn't unprecedented to accept an offer for an amount lower than your all time high Elon's offer is a 38% premium over the price it was prior to him disclosing his position in the company. > We are in a downturn affecting the entire tech industry Some companies are down more than others, and some are doing fine. Twitter revenue is largely driven by ads and they are likely also going to be hit by Apple's privacy changes like all other ad based businesses. Meta (Facebook) has already said they expect ~$10 billion revenue hit from the changes. It's feasible to think that Twitter revenue for the year may actually drop and the stock price may not recover to the 2021 levels any time soon.
- pm90 5y ago
  IIRC The Apple privacy changes hit a very specific kind of targeted advertising that Facebook was great at monetizing. I’m not familiar with Twitters ad platform but it’s unlikely to have affected them as hard as they hit FB.
moralestapia 5y ago
>Twitter stock price was higher than Musk’s offer for most of 2021. That's cute but the past is gone. Twitter is clearly going downhill, both with their product and with their management (good thing they got rid of Dorsey, but perhaps that was too little too late), the stock just follows on that. If anything, people like Musk are the ones who still attract interest to the platform. >Twitter can bring more value to shareholders with or without Elon Twitter is on a very dangerous spot right now, their MAUs peaked long ago as young people go to other platforms, and overall, everyone is a bit of tired of the kind of discourse that predominates there, for instance, Trump was banned and I STILL find out everything about him because the people there (left and right-wing) are absolutely obsessed with him. Honestly, Twitter is the one social media platform that I wouldn't really mind if it just disappeared. At least Facebook has some family members in there and some pictures from my earlier years. Twitter brings nothing of value to my life and I'm sure I'm not the only one who feels like that.
- lupire 5y ago
  If Twitter allegedt failing didn't bring the stock price down before, why would it now? Trump is mainstream. MSM covers him, as do Reddit and Facebook posters.
coolso 5y ago
The high price was due to COVID and everyone being stuck inside. That’s over now and has been for some time.
sakopov 5y ago
It seems a little funny to me that people flock to the idea that Twitter's market cap in a fed-fueled stock market when literally everything was moving up is some kind of true valuation for Tiwtter. If anything Twitter is likely trading at or very close to its fair value now then it was last year when retail was throwing money into anything.
- mcintyre1994 5y ago
  I think the argument is that if long term holders wanted to sell at this sort of valuation then they would have last year when it was way higher. If there was a bunch of retail money fuelling it then they could have took advantage and got out but they didn’t. So why would they sell now for a smaller upside?
- WanderPanda 5y ago
  Gamestop is still at 150 so people are still throwing money into anything
  - lupire 5y ago
    GME is a bit weird because it was essentially a crowdsourced fundraising round for Ryan Cohen SPAC, expecting an NFT play. (Which I expect will fail spectacularly)
jokethrowaway 5y ago
2021 was a growth without fundamentals for the entire market, mainly funded by currency inflation and government influence. This bear market is returning to reality and paying the price for those profits.
harambae 4y ago
> and it’s likely that prices will return to previous levels at some point Wow, that's great news for Velodyne Lidar -- currently trading around $2 and was $28 less than 2 years ago. (Why bother with paltry 2x return on Twitter when you could get a 14x return?)

FFRefresh 5y ago

Surely there is both a status quo and survival bias going on with the existing leadership/management team. When you have an outside person who wants to change some fundamental things about the company, it seems natural that there would be resistance. As an outsider, I'm personally intrigued by the prospect. There are two things he's mentioned that I think could be very beneficial (outside of freedom of expression) to society: 1. Transparency - open sourced algorithms for what shows when and transparency about moderation decisions 2. Reduced short-term financial incentives - Given it'd be bank-rolled by someone with a lot of money and private, they wouldn't need to play the gray area game of increasing advertising & data sharing that other sites do.

systemvoltage 5y ago

The sad truth is that this is an intense political battle. I would personally favor Elon Musk taking over and shaking things up, any other position is untenable. And, I am saying this as a progressive. I think an open and transparent social platform would be great for the society. The issue is that managerial class of America, both in private and public sector, are in bed with each other. The government cannot suppress free speech using the frontdoor, but these social media companies (Meta, Twitter) as well as Big Tech machinery (Google, Apple, Microsoft, Amazon) act as a proxy for supressing political speech through opaque algorithms and straight up censorship. We, liberals, used to be exceptionally devoted to free speech. Just look up ACLU's cases from the 90's and prior. We were against the establishment. Against the managerial class crushing labor. Against the fucking 3 letter agencies. Now, my own party wants to turn America into an authoritarian censorship dystopia. It's hard to stand by that.

binarray2000 5y ago
Just as the Republican Party has been taken over by neocons, the Democrat Party has been taken over by neolibs. They both have the same ideas and are never on the oposite sides. That is why you see endless and meanilingless wars, media conglomerates, censorship, billionaire-class, 3-letter-agencies off the leash, workers in diapers.
deleted 5y ago
[deleted]
celdon25 5y ago
> Now, my own party wants to turn America into an authoritarian censorship dystopia You could start by lobbying to force tech companies over a certain size to disclose reasons for users or content being removed from the platform. The legislation would have to have teeth, naturally.
aaronblohowiak 5y ago
Even aclu doesn’t believe in free speech anymore, at least not like they used to

FranksTV 5y ago

Retention of staff. Finding good engineers is exceedingly hard, and I imagine there were rumblings of an internal revolt.

mcintyre1994 5y ago

Against this specific bid: the price is arguably low and holders aren’t likely to want to sell at that price. From Money Stuff: > problem with Musk’s offer is that it is pretty low. Musk points out that $54.20 “represents a 54% premium” over where he started investing in Twitter, and a 38% premium over where the stock was before he announced his position. But Twitter was in the $60s in October, and a lot of its big long-term holders seem unlikely to be sellers at $54.20. “‘No board in America is going to take that number,’ said Jefferies analyst Brent Thill.” Against the bid coming from him: - He famously pretended he was going to take Tesla private and got in trouble because he was pretending. Takeover offers usually don’t have that history I guess. - He doesn’t have financing, not even pretend financing like when he said he was going to take Tesla private

ransom1538 5y ago

"Is there a NON-culture/political reason for all the push back against Musk buying Twitter?" Power. One side wants to have a safe garden where all their thoughts are heard with the other side silenced.

gadders 5y ago

Nope. It's all about people having to protect The Narrative.

incomingpain 5y ago

hogrider 5y ago

Musk is a free speech absolutist so he would lift all free restrictions.