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It is highly likely that Musk's financing will pull out if they haven't already. The market is down so the value of his existing wealth has dropped. Musk may no
by xenadu02 4y ago
It is highly likely that Musk's financing will pull out if they haven't already. The market is down so the value of his existing wealth has dropped. Musk may not have the resources to close the deal. If they force him into bankruptcy they aren't going to get $44b.
They might have a number in mind that they're aiming for to back away - say $10b. They might also have him agree not to start a potential competitor for 10 years.
On the flip side they might think the markets will remain down for some time and the premium price is worth going full scorched earth on Musk. In that case he'll have to eat some punitive financing costs or file bankruptcy - most likely the latter because I can't see him giving up his stake in Tesla and SpaceX.
- rurp 4y agoThe financing is already committed, the banks don't have any more right break a contract for convenience than Musk or Twitter do. > If they force him into bankruptcy they aren't going to get $44b. Why not? He appears to still have the non-financed amount well covered by his Tesla, SpaceX, and other assets. Even if markets implode much further they'll still be able to recoup much more than the $1B cost Musk is hoping to get away with.
- ksherlock 4y agoIf the financing pulls out, the acquisition is canceled and there's a $1 billion termination fee. As described above, if the conditions to Parent’s and Acquisition Sub’s obligations to complete the Merger are satisfied and Parent fails to consummate the Merger as required pursuant to the Merger Agreement, including because the equity, debt and/or margin loan financing is not funded, Parent will be required to pay Twitter a termination fee of $1.0 billion.