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Elon Musk buys Twitter for $44 Billion
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Old 14-05-2022, 11:22   #46
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Re: Elon Musk buys Twitter for $44 Billion

Yawn. A pox on Twitter, a bigger pox on Facebook.
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Old 14-05-2022, 12:05   #47
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by Damien View Post
It is but this is what is done as part of due diligence before you commit to buying. It's weird he is at this stage and now he suddenly wants to do it.
Not at this scale of purchase. Due diligence can be highly complex and can’t be hidden, nor can it be done when the potential purchase becomes public and the market is all ‘will they won’t they’. That sort of volatility is undesirable and likely to attract unwelcome attention from the market authorities. If you keep people guessing about whether a purchase will go ahead, eventually it starts to look like share price manipulation.

Any offer to make a very large purchase is subject to due diligence. We all do it at some time in our lives - a house purchase offer is always subject to satisfactory surveys. Even if the home report is available from the outset, various other searches have to be done and in some cases special surveys of the electrical or gas systems may take place.

Back in the day when I worked for a major international hotel company, it announced an agreed offer to purchase a large regional hotel chain which itself had well over 100 hotels. For the next 3 months, every senior executive in the place was on the road, visiting every single one of the hotels to establish that they were all there and in satisfactory condition.

Obviously there are certain things that you can, and should, satisfy yourself about before you make the offer, but there’s plenty that you can’t - especially proprietary details that the company being bought can’t and won’t give out to just anyone.
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Old 14-05-2022, 14:07   #48
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by Chris View Post
Any offer to make a very large purchase is subject to due diligence. We all do it at some time in our lives - a house purchase offer is always subject to satisfactory surveys. Even if the home report is available from the outset, various other searches have to be done and in some cases special surveys of the electrical or gas systems may take place.
Elon Musk skipped it though, he has committed to buying Twitter unless something major happens. He hasn't made an offer pending due diligence, he waved that right already and signed the deal: https://news.sky.com/story/elon-musk...-flap-12612206

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It is the sort of issue that might have been addressed in due diligence - the process by which buyers and their banks closely examine the company they are acquiring - had Musk not waived that step in order to hustle the Twitter board into a swift decision on his offer.

There is a good breakdown here of why this 'on hold' story is yet more Elon Musk showmanship: https://www.bloomberg.com/opinion/ar...trolls-twitter

Quote:
“Temporarily on hold” is not a thing. Elon Musk has signed a binding contract requiring him to buy Twitter. Legions of bankers and lawyers and Twitter employees and special-purpose-vehicle promoters are working to fulfill his legal obligation to get the deal closed. “The parties hereto will use their respective reasonable best efforts to consummate and make effective the transactions contemplated by this Agreement,” says the merger agreement. (Section 6.3(a).) He can’t just put that “on hold.”

That contract does not allow Musk to walk away if it turns out that “spam/fake accounts” represent more than 5% of Twitter users. We discussed this last month, when Twitter admitted in a securities filing that it had (slightly) overestimated its daily active users for years. 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.
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Old Yesterday, 12:25   #49
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Re: Elon Musk buys Twitter for $44 Billion

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Elon Musk says Twitter has to show spam accounts are less than 5% for takeover to go ahead
The billionaire Tesla founder steps up his efforts to reduce the price tag he has agreed to pay for the social media platform by demanding Twitter publicly declare a true figure for fake accounts.

Elon Musk has warned his planned $44bn (£34.6bn) deal to buy Twitter will not move forward until the company's chief executive publicly shows proof the platform has less than 5% spam accounts.

The world's richest man, who revealed last Friday that the takeover was "on hold" over the issue, said his offer to buy the company was based on filings by Twitter to the US markets regulator SEC (Securities and Exchange Commission).

Twitter estimates that the number of spam/fake accounts represent less than 5% of users but has admitted a constant battle to eliminate them.

They include so-called bots - automated accounts which have the potential to ply the platform with spam and potentially harmful activity.

They are programmed to perform multiple tasks like a human user, including things like retweeting posts.

It sounds harmless enough except for the fact bots across social media are blamed for influencing elections, conducting misinformation campaigns and terrorising individuals or groups.

The billionaire suspects fake accounts make up at least 20% of users - damaging the landscape for advertisers.


Twitter has adopted a strategy used to prevent hostile takeovers after Elon Musk offered to buy the company outright

He wrote on Twitter early on Tuesday: "My offer was based on Twitter's SEC filings being accurate. Yesterday, Twitter's CEO publicly refused to show proof of under 5%. This deal cannot move forward until he does."

Musk appears to be using the issue as a way to force down the agreed price for the takeover - with Twitter's shares suffering amid the acrimony being played out in public.
https://news.sky.com/story/elon-musk...rward-12615034


I wonder if he is related to Donald Trump
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Old Yesterday, 13:14   #50
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Re: Elon Musk buys Twitter for $44 Billion

Don’t know what this obsession to link things to Trump is all about lately on here.

Musk is doing what any other business-headed top brass would do, drive down a company such as Twitter and it’s value, so it costs him less. Where comparisons to Trump, fits in to this is beyond me.
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Old Yesterday, 13:35   #51
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by Mick View Post
Where comparisons to Trump, fits in to this is beyond me.
the comparison is easy; making up completely baseless and unfounded facts and statistics and using them in such a way that they have a sense of credibility and could be plausible. I haven't read through this thread and I haven't seen any other comparisons to Trump made but as soon as I read that it is the first thing that popped into my mind. If he thinks that kind of behaviour is okay then it explains why he thinks Trump's behaviour is acceptable and happy to see his ban overturned.

It is one thing to explain that you are acting responsibly and exercising an abundance of caution in investigating the number of fake accounts on a platform you are buying and it is another thing to say "well I know Twitter says it is 5% or less but I think it is 20% or more". Really? What evidence have you got to substantiate that outrageous accusation and that level of incompetence on Twitter's part? You can't spout random negative information and treat it as fact/true until someone proves otherwise. If you disagree with me then look at it from another perspective. That is the same ideology conspiracy theorists use. Make something up which suits our narrative and when somebody tries to disprove it we'll make something else up to dismiss their argument. I hope he gets sued for that or the government take action against him. He plays fast and loose with the stock exchange and shares.
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Old Yesterday, 13:47   #52
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by Mick View Post
Don’t know what this obsession to link things to Trump is all about lately on here.

Musk is doing what any other business-headed top brass would do, drive down a company such as Twitter and it’s value, so it costs him less. Where comparisons to Trump, fits in to this is beyond me.
Shouldn't he have done that before he had his offer accepted?
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Old Yesterday, 13:52   #53
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by General Maximus View Post
the comparison is easy; making up completely baseless and unfounded facts and statistics and using them in such a way that they have a sense of credibility and could be plausible. I haven't read through this thread and I haven't seen any other comparisons to Trump made but as soon as I read that it is the first thing that popped into my mind. If he thinks that kind of behaviour is okay then it explains why he thinks Trump's behaviour is acceptable and happy to see his ban overturned.

It is one thing to explain that you are acting responsibly and exercising an abundance of caution in investigating the number of fake accounts on a platform you are buying and it is another thing to say "well I know Twitter says it is 5% or less but I think it is 20% or more". Really? What evidence have you got to substantiate that outrageous accusation and that level of incompetence on Twitter's part? You can't spout random negative information and treat it as fact/true until someone proves otherwise. If you disagree with me then look at it from another perspective. That is the same ideology conspiracy theorists use. Make something up which suits our narrative and when somebody tries to disprove it we'll make something else up to dismiss their argument. I hope he gets sued for that or the government take action against him. He plays fast and loose with the stock exchange and shares.
I think you’re missing business studies lesson 101, all companies on Stock Exchange compete and play like that and as for calling him out on the spam account accusations being fake, what makes you privy to Twitter internal statistics?

---------- Post added at 13:52 ---------- Previous post was at 13:49 ----------

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Shouldn't he have done that before he had his offer accepted?
He did and thinks he’s been mislead.
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Old Yesterday, 13:52   #54
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by TheDaddy View Post
Shouldn't he have done that before he had his offer accepted?
Exactly. Instead of acting maturely and doing his due diligence he is pitting his dummy out after the fact.
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Old Yesterday, 13:54   #55
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by General Maximus View Post
Exactly. Instead of acting maturely and doing his due diligence he is spitting his dummy out after the fact.
Seems to be taking a leaf out of Johnson's book. Sign an agreement and then go back on it.
As always - act in haste, repent at your leisure.
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Old Yesterday, 14:02   #56
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by Mick View Post
He did and thinks he’s been mislead.
If that's the case then Twitter are in big trouble. We use percentages and statistics instead of arbitrary numbers for a reasons. There is a big (and inexcusable) difference between 5% and 20%. If Twitter are saying something is 5% publicly and now that he is majority shareholder he has seen internal communication which may indicate something is in fact 20% then Twitter can get in big trouble for manipulating its share price. Either way somebody needs to be held responsible because either answer too much of an unrealistic variance.
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Old Yesterday, 14:22   #57
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Re: Elon Musk buys Twitter for $44 Billion

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He did and thinks he’s been mislead.
I think he's been misleading us all, not sure his heart was ever in it, seemed like things got out of hand really quickly and he didn't want to back down and now this is all very convenient. Stand to be corrected when the deal goes through of course and it's 50% of accounts but that's just the feeling I got watching it all unfold
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Old Yesterday, 17:49   #58
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Re: Elon Musk buys Twitter for $44 Billion

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Originally Posted by TheDaddy View Post
I think he's been misleading us all, not sure his heart was ever in it, seemed like things got out of hand really quickly and he didn't want to back down and now this is all very convenient. Stand to be corrected when the deal goes through of course and it's 50% of accounts but that's just the feeling I got watching it all unfold
As rich as he is, I don’t he’d spend $44 Billion on a whim like that. His true aim is as I said above, he’s probably attempting to drive down Twitter’s value, having discovered Twitter might have more spam accounts than they have let on in a prior negotiation deal.

I will say this though, Twitter shareholders, could see through this and totally reject the deal, ownership hadn’t yet changed hands and there was issues with his SEC filing on his initial share purchase that could still scupper the whole arrangement.

Musk had already vowed to unban Trump, so it doesn’t take some guess work that there may be some attempt to stop this deal dead. Given that everything that is going on in America, baby food shortages, Joe Biden’s serious unpopularity and docile approach to everything and he’s vowed to run again in 2024. An unbanned Trump with 88 Million following, vs Biden, gives Trump the 2024 ticket.
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