Twitter (TWTR) shares halted on report Musk will go through with acquisition
Twitter's stock jumped today on news that Musk has reconsidered the deal and will go through with the $44 billion acquisition
Elon Musk has reportedly changed his mind about the Twitter deal again and will now go through with his original offer to buy the social media company for $44 billion.
Source: The Joe Rogan Experience
Bloomberg reports that Elon Musk is once again proposing to buy Twitter for $54.20/share. The Tesla CEO sent a letter to Twitter affirming his decision to carry out the $44 billion acquisition. After months of trying to squirrel out of the deal, it has become very apparent that the billionaire entrepreneur failed to carry out proper due diligence before making the original offer back in April. Buyer's remorse is not cause for a break of the deal, and now the acquisition will likely go through despite Musk's best efforts in Delaware court.
lol did I say "maybe he'll just show up and actually close" https://t.co/SvPIjCtCkg
— The Chancery Daily (@chancery_daily) October 4, 2022
Over the past month, Twitter and Musk's lawyers have been battling it out in Delaware. Twitter's lawyers have been rather transparent about the sticking point of monetizable daily active users (mDAUs) being the metric the company uses to measure its success. Musk has spent most of 2022 calling Twitter's management out for poor disclosure of the number of bots on the platform. Twitter provided even more disclosure on how activity is measured, but these were questions Musk should have been asking before agreeing to a deal at the end of the day.
Tesla demos are always rough, and that is the case with the production prototype of the Optimus robot. $TSLA #TeslaAIDay
— Shacknews (@shacknews) October 1, 2022
Still live at https://t.co/bHt9VvRLHy pic.twitter.com/SiMSeJlfN1
While today's news may be the beginning of the end of this ridiculous period for Twitter shareholders, users of the social media platform are now staring down a future with Elon Musk in charge. Hopefully this transition of power goes smoother than that Optimus Robot demonstration this past weekend.
Twitter issued this statement about today's news: We received the letter from the Musk parties which they have filed with the SEC. The intention of the Company is to close the transaction at $54.20 per share.
— Twitter Investor Relations (@TwitterIR) October 4, 2022
Twitter Investor Relations has confirmed the company's receipt of the letter from Elon Musk and intend to close the transaction at $54.20/share.
This article is only meant for educational purposes, and should not be taken as investment advice. Please consider your own investment time horizon, risk tolerance, and consult with a financial advisor before acting on this information.
Full Disclosure:
At the time of this article, Shacknews primary shareholder Asif A. Khan, his family members, or his company Virtue LLC had the following positions:
Long Twitter via TWTR shares
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replyAsif Khan posted a new article, Twitter (TWTR) shares halted on report Musk will go through with acquisition
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It could be that the price is good enough that eventually Elon Musk will make a profit on the whole thing if he's willing to wait to sell shares of Twitter stock.
It also could be that he's in a bad position legally against twitter and he wants to avoid a lawsuit that ends up with him not having shares of twitter to eventually sell.
I'm not sure what it is. He's an idiot for even expressing an interest in having so much control of Twitter. $44 billion is a bit steep for that sort of thing.-
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Yeah legally he's in a tight spot. He better pay up or the judge will force him to pay up along with punitive damages.
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Exactly—he’s 100% gonna loose the lawsuit. He’s either got to pony up and buy twitter at the agreed price OR settle with twitter for like 15-20billion and *not* own them. I think twitter mgmt has no incentive to settle so Elon put his big boy pants on finally. Glad to see twitter will have yet another absent ceo.
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Acquirers should do due diligence before signing the deal, not after Russia invades Ukraine.
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Not sure what Russia invading Ukraine has anything to do with this lol.
But yeah Elon absolutely should have done due diligence before signing anything.-
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Oh wow I did not know about that.
That just shows how dumb Elon is about this.
lol
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at this level of M&A, the lawyers have LOTS of circuit breakers to stop deals based on due diligence along the way.
elon apparently decided to use none of the fail-safes or waived them to get a better deal or something. twitter did completely fudge the numbers, and theoretically elon SHOULD be able to walk away easily.
punishing elon personally is one thing, I understand folks' motivation for having him be forced to buy twitter, but separating those emotions out... this is a super bad deal and I'm really curious why elon can't cleanly say "nope fuck you, you lied, deal is off"-
You read the text messages they released as part of the trial? Elon knew about the bots before he even offered to buy. He has negative legs to stand on.
He finally sobered up and is being smart about this. Helluva bender he went on, he’s got bragging rights for like the next hundred years on—you think impulse buying that $250k Lamborghini was a big deal?? Boooy let me tell you!-
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I meant he’s sobering up now by dropping this lawsuit. He was gonna lose, why piss away more money on lawyers? Time to make some lemonade, he’s still gonna own twitter.
I still can’t fathom why he signed the deal at that price at that time. It seemed so outrageous and it still does. Buuut, I wouldn’t bet against Elon. It make take decades for this to payoff for him, but it wouldn’t surprise me if it does.-
his own ego is such a fucking disaster. I think he's punched out all his "get out of a thing" tokens from the SEC.
he has made WHOPPERS of claims about tesla and its stock and buyouts and all that. inflating twitter's value to 44 BILLION dollars is a complete fucking disaster and will be loooooooooonggggggggg after he's dead that even a fraction of that will be recuperated.
like you said, he's gotta make some fucking lemonade now, and he will freak out and drive people away from twitter in droves based on his "disruption" plans or whatever.
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You say it's a bad deal. Currently it is a bad deal for Elon but if he's patient and owns all of the shares of stock for the $44 billion he could eventually make a profit.
Eventually. I don't see it happening super soon but it definitely could happen.
He just has to be patient. -
because they didn't lie and/or elon knew it was a lie and made a hostile bid for the company. twitter didn't want to agree to the deal, but musk kept being an asshole about it.
here's a good piece about why/how musk fucked himself into having to go through with the buyout:
https://www.bloomberg.com/opinion/articles/2022-09-07/does-elon-musk-know-how-mergers-work-
that is a great article. it's amazing that "due diligence" had to come from a whistleblower though. twitter has been misrepresenting stuff and they know it, and are desperate to enforce the deal. I completely understand the shareholders' perspective. OF COURSE THEY APPROVED THIS DEAL.
musk is a major asshole and definitely thinks he's above and around the whole thing, just like the article insinuates.
And Twitter is an odd and broken company, which is explicitly why Musk wanted to buy it, so it wouldn’t be hugely surprising if it was broken in particular ways that breached a standard merger agreement. Even if Musk is just looking for excuses to get out of the deal, that doesn’t mean he can’t find one.
like you said, musk also did hint that he alone has the magic formula to "fix twitter" and unlock its hidden potential, so in theory, he thinks twitter is UNDERvalued and he theoretically doesn't care about bots.
it's just super fucking weird that twitter did in fact bury the numbers and we had a full on whistleblower situation showcase how bad twitter has been run, which if I was elon, I'd want to back the fuck out too.-
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The merger agreement contains a provision that allows Musk to walk away if Twitter’s securities filings are wrong — and this 5% number is in its securities filings — but only if the inaccuracy would have a “Material Adverse Effect” on the company. (See Sections 4.6(a) and 7.2(b).) That is an incredibly high standard: Delaware courts have almost never found an MAE. An MAE has to be something that would “substantially threaten the overall earnings potential of the target in a durationally-significant manner,” the courts have said; there is a rule of thumb that an MAE requires a 40% decrease in long-term profitability. If it turned out that 6% or 20% or 50% of Twitter accounts are bots, that will be embarrassing and might even reduce Twitter’s future advertising revenue, but will it be an MAE? No.
https://www.bloomberg.com/opinion/articles/2022-05-13/elon-musk-trolls-twitter
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This isn't about punishing Elon. This is about not letting rich guys get away with breaking the law. He signed a contract. All this nonsense you're saying about theoretically he should be able to walk away easily and he should be able to just say they lied is exactly that, nonsense. He waived his rights to due diligence. Twitter reported numbers the same way for years to their investors, numbers which Elon used to justify his original purchase price without doing any due diligence. He gets to pay his bill now, not walk away because he's mad he made a bad deal.
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twitter doesn't deny any of it
https://www.theverge.com/2022/8/23/23317857/twitter-whistleblower-zatko-security-spam-safety
they have been lying for years and years BEYOND a material degree. but elon apparently is so fucking stupid he can't even arrange for that to be leaned on
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the bot misrepresentation is debatable, and would have to have a major affect on the stock price to be used as an out. it doesn't help that the reason elon stated that he wanted to buy twitter was to fix the bot problem, so it could be argued that he knew anyway.
as for shitty contract lawyers. if the worlds richest man says get the deal signed, they get the deal signed. they're not going to delay it by trying to cover his ass incase he changes his mind.
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Lol wat
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Haha go figure
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lol
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After AI day he’s taken a pro-bot stance
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Let Trump on there so I can quit Twitter forever
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Can't wait to see how free he makes the speech on there
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I hope after he buys all that twitter stock it drops to ten dollars a share so that he will never make a profit on it. He would lose billions.
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Hm well that would make it harder to make a profit.
I dunno what he could do with it. Sell t-shirts that say "I lost my shirt on useless Twitter stock?"-
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Eh, whatever. He can do whatever he wants. But I think taking it private would be a very bad move for him financially.
Eventually just selling the Twitter stock is his best move.-
At some point I'm sure he will, but this whole ordeal is about taking it private. He said something along the lines that in order to fix Twitter and make it profitable its going to need some major changes, so drastic that it would not be able to happen with a public company. I'm sure the master plan is to take it private, fix it, and go public again and sell for a profit.
If he can do that remains to be seen.-
He's not legally obligated to take it private right? It wouldn't be glamorous or anything but that might be his out. Just don't take it private and right for price points and sell. He can't sell all of it at once but he could sell a portion each time.
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He could also trim down that number of employees from 7,000 to something more reasonable.
I'm not sure what is reasonable. 4,000 employees? I don't know. I guess Elon is going to find out how the sausage is made at Twitter.
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one thousand percent
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Elon is of the mind that the 'woke mind virus' is one of the top threats to society so he will be handing the reigns to the nazis to fix it
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or ban that one dude who tracks his private jet.
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Maybe he’s mad he can’t ban pro-Ukraine people from replying to him and making him look bad
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Which texts?
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https://www.theverge.com/2022/9/29/23379435/elon-musk-jack-dorsey-twitter-buyout-texts
The actual texts are more interesting than the article. Appearances from Justin Rolland, the CEO of Riot, Joe Rogan
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His lawyers might have made clear to him that his legal arguments sucked on a trial wouldn't be good for a lot of reasons
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the LBO looks like it's a fucking nightmare in and of itself
https://www.bloomberg.com/news/articles/2022-10-04/twitter-lbo-revives-12-5-billion-headache-for-wall-street-banks?srnd=premium
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Sidenote, the head of axel springer publishing se, the company that bought politico and business insider amongst other shit was the one that pushed musk to bid for twitter with the suggestion that he would supply the people to run it for him. If you are not familiar with the name döpfner/springer the best analogy is german murdoch/newscorp conservative shitrags. Dubious at best malicious on a daily basis.
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Jack Dorsey and others were pushing him to do it too
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Wonder if people would use Twitter if there were no ads and they have to pay a small fee for using it.
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that's how TweetDeck and Twitter Blue already work
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Oh okay. I didn't know that. So I'm out of ideas officially.
Hope Elon Musk can find something that works.
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Twitter: We received the letter from the Musk parties which they have filed with the SEC. The intention of the Company is to close the transaction at $54.20 per share.
https://twitter.com/TwitterIR/status/1577380758192197632 -
Sweet and merciful Xenu, I have finally exited this hellscape of a stock holding. Made a nice profit, but happy to be out.
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Does he still owe you a roadster?
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There are no Shacknews NFTs.
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There are no plans to release Shacknews NFTs. I don’t think crypto is very efficient at anything.
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It's sort of efficient at separating idiots from their money. But there's probably something more efficient than that.
Russian war bonds endorsed by Mike Flynn. Trump would endorse but he's got a golf tee off to attend.
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I'll give you $3 if I can have sole ownership of the restaurant tickets post
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Are we having this thread again? Redfive won the last one. Maybe I can win this one after fifteen years.
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What if it gets deleted? Do we keep the money?
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I have studied play-to-earn game business models and I have found no evidence to believe they are not ponsi schemes.
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I would rather sell hats.
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Hats that say Make Shacknews Great Again?
Of course it'll have a picture of Lola on it or some Shacknews logo or something.
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I'm assuming that this article from The Atlantic a couple days ago triggered him: https://www.theatlantic.com/technology/archive/2022/09/elon-musk-texts-twitter-trial-jack-dorsey/671619/
The article is making the case that these SV millionaires/billionaires aren't rational brain geniuses, but instead are a bunch of hysterical dudes riding purely on vibes.
Elon sure is proving them wrong with this move-
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If they're not treated as the smartest people on the planet the entire mythology around the meritocracy and working your way up goes out the window
If Musk isn't best because he's richest then how is some middle-manager gonna convince the team in the stockroom to up their packing rate??-
I'm reminded of Michael Larson, the dude who made all the money on Press Your Luck. As a reminder, this is the guy who figured that squares got highligted was a repeating pattern and so if you just memorized the pattern you could rack up tons of money, free spins, more money, etc. The producers figured out what he was doing but he wasn't cheating, he was just really good and had cracked the code, so he got to keep the money he won (over $110k)
https://en.wikipedia.org/wiki/Michael_Larson
Anyways, what reminds me of this guy was when I saw one of the documentaries about the whole incident, one of the themes in the people who were his relatives and friends is that he was someone who thought he was smarter than everyone else, thought working for a living was for suckers and was always looking for the next get rich quick scheme, and he was pretty insufferable as a result. And the fact that he figured out how to do this thing with the game show and was successful at it was just reinforcing his views.
Granted his story after that is pretty tragic - he loses some of his money in failed real estate investments, he took out most of his money in cash in $1 bills to try and win a radio contest (for a matching serial number on a $1 bill) and about $50k of it got stolen in a burglarly, he got involved in a fraud scheme and absconded to Florida where he died of throat cancer before the SEC could find him.
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getting extremely rich being a contrarian once or twice is very dangerous for your brain's development
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Ok some more details
This is the letter Musk's lawyers sent to Twitter.
It leaves him with some outs again, and more importantly is contingent on the lawsuit being stayed.
https://twitter.com/chancery_daily/status/1577377535255613442/photo/1
His offer means shit unless he buys -
Do we know when the deal will close? That's the day I'll be deleting my account.
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Okay, so NYsouthpaw took a look at the letter. Seems like this is more about stalling the litigation and avoiding being put on the stand at trial. The wording isn't a firm commitment to buy Twitter. He can still bail. https://twitter.com/nycsouthpaw/status/1577405771113189376
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Everyone should quit twitter to spite Elon.
I don't know what WP or NYTs reporters are gonna do though. Maybe ask the baristas for gossip?
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For the financial people out there: How the hell is this not market manipulation? Or is it and Elon’s just too fucking rich?
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The latter...
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he keeps doing this shit, I mean, with no repercussions
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i mean he didn't have a choice right, it was already bought when he signed and waived his right to due diligence? the rest was just.... being pouty about it as far as I can tell.
what a dum dum -
If Musk turns Twitter into an alt-right shithole I intend to vote with my wallet and stop all my company’s media campaigns on the platform.
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