The following rule of thumb for Twitter’s short message service: Anyone who wrote something stupid – and this is often the case on Twitter – will sometimes want to undo it and can also delete the post with a single click. The man who actually agreed to buy Twitter is also trying to hit the delete button: Elon Musk, Tesla boss, show founder, world’s richest man.
The 51-year-old tries to cancel his purchase of Twitter, one of the most publicized corporate purchases of the year. And this despite the fact that Musk and Twitter have had a deal since April under which Musk will buy the company for 44 billion dollars. It already owns 9.1 percent. Twitter.
His lawyers filed a document with the US Securities and Exchange Commission on Friday in which Musk is withdrawing from the company’s purchase. They justify this by saying that Twitter has listed too low a number of so-called spam bots. Spam bots are user accounts that automatically spread, for example, silver advertising or propaganda.
So the argument is that Twitter bosses tricked Musk, and the short message service has far fewer real users than it claims. Twitter denies the accusation. Chairman Bret Taylor toresign He said they would go to court to get Musk to make a deal and buy the company.
It is rare that an attempt to take over a company is made so publicly – only to fail with a bang. From Musk’s point of view, the deal is clearly worth little more than the rubbish a spam bot throws at you.
Negotiation makes everyone involved look bad
So there is no deal. Negotiations end in a bang that makes everyone involved look bad. Musk broke his promise. And the current owners of Twitter, as well as top management, are sitting with a company for which no one is sure to offer the price Musk has offered.
But one by one. Twitter has always been your mediocre social network: politically relevant as a space for debate, but with far fewer users than Instagram, Linkedin, Telegram, and Facebook. In addition, Twitter lacked a clever idea to make a lot of money with over 200 million users. Musk has indicated that he wants to develop an ad-based business model into a user payment model.
In April, Twitter and Musk agreed to buy the company for $ 54.20 per share, well above the price at the time. Musk announced he will create a better Twitter: less bots, more freedom of expression. From Musk’s libertarian point of view, the latter likely means that fewer violent or threatening posts are removed after Twitter has started to better protect its users from insults, racist posts and slander in recent years.
However, shortly after the deal, Musk started a dispute with Twitter boss Parag Agrawal that focused on spam bots and fake user accounts. Musk has repeatedly explained that Twitter is drastically understating that up to five percent of its user accounts are not real. How he got it remains a mystery. Twitter gave him access to the “fire hose”, the data stream that allowed Musk’s experts to analyze every tweet in the story. The musk still groaned anyway.
This makes Musk look unprofessional as usually the buyer deals with the acquisitions of the business due diligencea thorough examination of the company, before signs the purchase contract. So Musk started to torpedo his own deal from the day it was signed. He complained about the lack of transparency in the bot question and insulted Twitter boss Agrawal – on his own platform, of course. But Musk already had a large number of bots before contracts as the reason why he wanted to buy the company – to put an end to the scourge of the bot.
Twitter is Musk’s favorite toy
So he was just messy? That’s possible given his interest in Twitter is personal, not business. Musk is said to have some twitter addiction, with his 100 million followers only surpassed by Barack Obama and mega-celebrities such as Rihanna and Cristiano Ronaldo. The website is his favorite toy, on which he spreads his libertarian worldview, which has recently become increasingly open to reactionary views and which he makes fun of his critics. His use of Twitter “beat” Musk, so to speak, and Trump fans also hoped that Musk could unblock the US President. Twitter imposed it after storming the Capitol. This will not happen for now.
Even if venture investor Paul Graham on Twitter commented“Do you really want to belong to someone who doesn’t want you?” Musk has probably lost his fascination with Twitter as a medium. More likely, it came to the conclusion shortly after the deal was concluded that the agreed purchase price of $ 54.20 per share was far too high. Technology stocks, including Twitter, plunged sharply shortly after the transaction. This includes Musk’s stake in his electric car company Tesla, the value of which is largely based on his fortune. They have lost a third of their stock market value since the announcement of the deal. It is possible that Musk’s departure is an attempt to lower the price. If the deal fails Musk will have to pay a billion dollar fine – or Twitter, the guilt issue should also be dealt with in a court of law. But Musk may make a different – lower – offer in the future. Ultimately, all the confusion can also hurt Twitter in such a way that the high share price is still a long way off.
For Agrawala’s CEO, it is as embarrassing as it is for Bret Taylor’s board of directors to agree to a purchase offer, which then vanishes and must be sued. FROM New York Times according to policymakers, they were unprepared for Musk to end the deal right now.
But can Musk get out of the contract that easily? Twitter’s chances of winning in court aren’t bad, according to experts. Because that’s what a deal like the one Musk and Twitter is all about: lest buyers doubt when the stock prices of the company to be bought fall. In addition, its banks would have to cut off $ 13 billion of funding under the deal. But they can only pull back from these promised loans if the Twitter bot count is indeed heavily skewed, which Musk does not provide evidence for, and it would also seriously hurt Twitter’s business, to which there is no indication.
As if all of this didn’t get everyone in a bad mood, Musk disappointed his fans as well. They praise him as a kind of messiah who breaks down all the encrustations in the world, rethinks Western society, and by buying Twitter he should save the freedom of speech that is said to be under threat.
But for now, the Messiah is not coming. It was just spam.