TWITTER SHARES SANK 6% AT MONDAY’S MARKET OPEN – AS INVESTORS REACT TO ELON MUSK BACKING OUT OF HIS DEAL TO BUY THE COMPANY.
TWITTER’S BOARD PLANS TO SUE THE ECCENTRIC BILLIONAIRE TO HOLD HIM TO HIS $44 BILLION TAKEOVER DEAL HE MADE THREE MONTHS AGO.
THE DAY TWITTER ACCEPTED THE DEAL – SHARES CLOSED AT $51.70, JUST SHY OF THE $54.20 MUSK OFFERED.
BUT AS MUSK ATTEMPTS TO ABANDON THE DEAL, SHARES OPENED AT $34.60, 36% BELOW HIS INITIAL OFFER PRICE.
MUSK’S BEEN EXPRESSING BUYER’S REMORSE FOR MONTHS – AND IS ATTEMPTING TO PIN IT ON SPAM BOTS, SAYING THE COMPANY’S BEEN MISREPRESENTING THE NUMBER OF FAKE USERS ON THE PLATFORM.
TWITTER’S ADAMANT IT’S LESS THAN 5%.
SO WHAT HAPPENS NOW?
IF THE TWITTER BOARD HAS ITS WAY – MUSK IS FORCED TO CLOSE THE DEAL AT $44 BILLION.
OR THE COMPANY COULD TRY TO HOLD HIM TO A $1 BILLION BREAK-UP FEE WRITTEN IN THE AGREEMENT.
MUSK WILL EITHER TRY TO WALK AWAY CLEAN BY PROVING WHAT’S CALLED “MATERIAL ADVERSE EFFECT,” THAT BOTS SHOW SOMETHING IS WRONG WITH THE BUSINESS THAT WASN’T PROPERLY DISCLOSED.
OR HE COULD USE THE LEGAL SAGA TO TRY TO NEGOTIATE A BETTER PRICE.
IN NEW YORK FOR JUST BUSINESS I’M SIMONE DEL ROSARIO.