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> 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
by 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 agoBecause Twitter is not a hedge fund.
- gitfan86 5y agoTwitter 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 agoI 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 agoNo, 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 agoIf 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.