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So much noise here and ill-informed comments fail to give a broader understanding of what's going on. Elon bought up Twitter shares early in the year for a rea

So much noise here and ill-informed comments fail to give a broader understanding of what's going on. Elon bought up Twitter shares early in the year for a reason, because he wanted more control over Twitter. He bought up so much Twitter shares that when it was announced via the SEC, Twitter offered a board seat under the clause that he wouldn't acquire too much % control over the company. He obliged, but then left when he realized he couldn't make the changes he desired at the company. Plus, people on the board at the time, specifically Dorsey, was nudging him to buy out the company as a whole. So he did, hastingly. That was an ill-informed decision and obviously a mistake made with respect to doing due-diligence. In hindsight, before the market crash that price may have made sense. But fast forward today with looming recession talk, it's pretty clear he realized it's overvalued (we know this from tweets about twitter deal being repriced). And so he needed an escape hatch, hence the issue with bots and the unverifiable mDAU was a great talking point. In fact, he may as well be right on the issue as Twitter doesn't want to reveal how they calculate it. What he's trying to do right now is pretty clearly force the board to give a better deal. He's not sold any stock and likely won't unless he's actually out for good. But given the amount of effort and thought he's put into it and making it clear that he should pay a lower price depending on the bot issue, I don't think there's much doubt he's not actually leaving Twitter. Whether the courts will force an acquisition at the current price however, is a looming question. My bet is they settle at a lower price.

nocoiner 4y ago
Almost everything in this comment is wrong or misleading. The point of an acquisition agreement isn’t to give the buyer optionality to acquire another company, it’s to ensure the buyer honors its commitment to acquire another company during the period between the time the buyer agrees to acquire it, and the time is it able to close on taking ownership. Maybe EM developed buyer’s remorse because of the decline in equity markets, or a belated realization that the CCP will have significant leverage on how he runs twitter, or just woke up the day after signing with that feeling you get when you realize you’ve knocked up Grimes not once but twice. Just because EM wants an escape hatch, doesn’t make it so. There’s a pretty tight contract that says he needs to buy twitter, at the agreed price, using the committed financing he arranged. EM can try to retrade the price all day long, but then there’s still that pesky matter of a binding contract… to buy Twitter… at the price he agreed with the board… that doesn’t have a diligence out or an “ehhh changed my mind” termination provision. For a variety of reasons, the board doesn’t have a tremendous number of appealing options (like none) but they have a strong contract that explicitly contains EM’s affirmative obligation to, y’know, buy Twitter. That fact has very little to do with his feeling.
- extheat 4y ago
  > Almost everything in this comment is wrong or misleading. Feel free to point out specific inaccuracies. I think it's pretty clear. > Just because EM wants an escape hatch, doesn’t make it so Yes, never suggested it's legally permissible. > affirmative obligation This is armchair speculation. Even if the text might seem to be clear in outsider interpretation, this is a matter solely for the courts to determine and both sides will have an opportunity to make their points across. I stand by prediction of the board ending up settling this case. It will get obviously challenged in court, but it's not "wrong" in the sense of predicting an outcome.
  - threeseed 4y ago
    I think it's the fact you think that Twitter has been misleading in how it communicates MAU and bot percentage to the markets. There is no basis to this. And even if there was it's such a grey area that they have plenty of legal wiggle room. So it's really to comprehend how Musk has any sort of bargaining position over this issue.
    - extheat 4y ago
      Going through court will lead to even more dragged out speculation and hurt Twitter more than any other party. They can't be 100% sure that they will win the case, and will also have to work to run the company on the side in a continuing state of limbo with the acquisition litigation. In the end, even if they win, and Musk must buys the company at the deal price, by the time that goes through the markets may as well have rebounded to make the acquisition price reasonable again. Buying a company isn't like buying a piece of candy and eating it to the point of no return. The amount of money Elon has on paper won't be impacted, which a lot of people are not understanding. The winners at the end of the day would be the lawyers and millions of dollars dumped into fighting a case instead of settling.
      - vba616 4y ago
        >Going through court will lead to even more dragged out speculation and hurt Twitter more than any other party >The winners at the end of the day would be the lawyers and millions of dollars dumped into fighting a case instead of settling. I don't understand this popular hot take. There's no rich egomaniac foil for EM, is there? There's just a corporate machine that he offered a piece of "candy" worth tens of billions and then tried to take back. As many people have said, if EM just walks away and Twitter does nothing, the stock price is probably half of what it was supposed to be acquired for. Ten billion dollars will fund a literal battalion of lawyers for a decade if necessary.
lovich 4y ago
I’m sorry, I need to ask a clarifying question here. Is it ok for us to seek escape hatches when we sign binding agreements with others? This is very important for me as I need to find out if I can just walk away from all the student loans, car notes, and mortgages I may have entered into, as it’s no longer convenient for me, and I would really appreciate if I could make that my counter party’s problem
cloutchaser 4y ago
The sale will happen at a lower price. Even though Elon would probably be forced to do the deal in 3-4 years. This whole thing actually creates a golden bridge eventually for the twitter board to retreat on. The board now has an obligation to sue, otherwise they are breaching their fiduciary duty. However, almost all shareholders will realise that a 2-3 year litigation at the end of which Elon might be forced to buy, is a long way away. Better to settle for a lower price now. Both shareholders and Elon will see this. The board just needs to demonstrate they are fighting for shareholders. I predict in 3-4 months the board will offer a shareholder vote with a lower price, and shareholders will realise that it's way better to take that deal than wait for litigation.

nocoiner 4y ago

Almost everything in this comment is wrong or misleading. The point of an acquisition agreement isn’t to give the buyer optionality to acquire another company, it’s to ensure the buyer honors its commitment to acquire another company during the period between the time the buyer agrees to acquire it, and the time is it able to close on taking ownership. Maybe EM developed buyer’s remorse because of the decline in equity markets, or a belated realization that the CCP will have significant leverage on how he runs twitter, or just woke up the day after signing with that feeling you get when you realize you’ve knocked up Grimes not once but twice. Just because EM wants an escape hatch, doesn’t make it so. There’s a pretty tight contract that says he needs to buy twitter, at the agreed price, using the committed financing he arranged. EM can try to retrade the price all day long, but then there’s still that pesky matter of a binding contract… to buy Twitter… at the price he agreed with the board… that doesn’t have a diligence out or an “ehhh changed my mind” termination provision. For a variety of reasons, the board doesn’t have a tremendous number of appealing options (like none) but they have a strong contract that explicitly contains EM’s affirmative obligation to, y’know, buy Twitter. That fact has very little to do with his feeling.

extheat 4y ago
> Almost everything in this comment is wrong or misleading. Feel free to point out specific inaccuracies. I think it's pretty clear. > Just because EM wants an escape hatch, doesn’t make it so Yes, never suggested it's legally permissible. > affirmative obligation This is armchair speculation. Even if the text might seem to be clear in outsider interpretation, this is a matter solely for the courts to determine and both sides will have an opportunity to make their points across. I stand by prediction of the board ending up settling this case. It will get obviously challenged in court, but it's not "wrong" in the sense of predicting an outcome.
- threeseed 4y ago
  I think it's the fact you think that Twitter has been misleading in how it communicates MAU and bot percentage to the markets. There is no basis to this. And even if there was it's such a grey area that they have plenty of legal wiggle room. So it's really to comprehend how Musk has any sort of bargaining position over this issue.
  - extheat 4y ago
    Going through court will lead to even more dragged out speculation and hurt Twitter more than any other party. They can't be 100% sure that they will win the case, and will also have to work to run the company on the side in a continuing state of limbo with the acquisition litigation. In the end, even if they win, and Musk must buys the company at the deal price, by the time that goes through the markets may as well have rebounded to make the acquisition price reasonable again. Buying a company isn't like buying a piece of candy and eating it to the point of no return. The amount of money Elon has on paper won't be impacted, which a lot of people are not understanding. The winners at the end of the day would be the lawyers and millions of dollars dumped into fighting a case instead of settling.
    - vba616 4y ago
      >Going through court will lead to even more dragged out speculation and hurt Twitter more than any other party >The winners at the end of the day would be the lawyers and millions of dollars dumped into fighting a case instead of settling. I don't understand this popular hot take. There's no rich egomaniac foil for EM, is there? There's just a corporate machine that he offered a piece of "candy" worth tens of billions and then tried to take back. As many people have said, if EM just walks away and Twitter does nothing, the stock price is probably half of what it was supposed to be acquired for. Ten billion dollars will fund a literal battalion of lawyers for a decade if necessary.

lovich 4y ago

I’m sorry, I need to ask a clarifying question here. Is it ok for us to seek escape hatches when we sign binding agreements with others? This is very important for me as I need to find out if I can just walk away from all the student loans, car notes, and mortgages I may have entered into, as it’s no longer convenient for me, and I would really appreciate if I could make that my counter party’s problem

cloutchaser 4y ago

The sale will happen at a lower price. Even though Elon would probably be forced to do the deal in 3-4 years. This whole thing actually creates a golden bridge eventually for the twitter board to retreat on. The board now has an obligation to sue, otherwise they are breaching their fiduciary duty. However, almost all shareholders will realise that a 2-3 year litigation at the end of which Elon might be forced to buy, is a long way away. Better to settle for a lower price now. Both shareholders and Elon will see this. The board just needs to demonstrate they are fighting for shareholders. I predict in 3-4 months the board will offer a shareholder vote with a lower price, and shareholders will realise that it's way better to take that deal than wait for litigation.