Elon Musk is 'legally wrong' in backing out of $44b Twitter takeover

Elon Musk is ‘legally wrongin backing out of $44 billion Twitter takeover and if he is forced to buy the company it will ‘die slowly and painfullyas CNBC host says he ‘may face JAILif he refuses

  • Elon Musk could be facing a court battle with Twitter after he backed out of his controversial $44 billion deal with the social media platform on Friday
  • 麝香, 51, accused the social media giant of ‘false and misleading representationsabout the number of fake accounts on its platform
  • But experts say it’s not enough to legally back out of the deal
  • One analyst called the saga ‘a circus showthat will end ‘as a circus show
  • Another predicted that Twitter would die off ‘slowly and painfullyif Musk is forced to buy the company because it will become neglected after some time
  • Elon Musk will have to fork over $1bn if the deal falls throughbut experts say the mogul will likely enjoy a $400m discount if he writes it off as a tax loss
  • Elon Musk is ‘legally wrongin backing out of $44 billion Twitter takeover and analysts say if he is forced to buy the company it will ‘die slowly and painfullyas a CNBC host claims the billionaire ‘may face jail timeif he refuses.

    CNBC’s David Faber made the claim when he appeared on Squawk on the Street on Monday days after Musk announced he was walking away from the highly publicized deal.

    麝香, 51, has expressed concerns that Twitter had been misleading about the number fake accounts on its platform, but has not presented any evidence to support his claims.

    Musk agreed to a $1 billion breakup fee as part of the buyout agreement, although it appears Twitter CEO Parag Agrawal and the company are settling in for a legal fight to force the sale.

    ‘There’s no way they’re going to take the walkaway fee,’ Faber said on Monday. ‘They have specific performance in the contract. They are going to have a Delaware judge enforce that contract and say, these are the reasons why.

    ‘Then the question is, 好的, you are forcing Mr. Musk to buy the company, does he actually agree to do it?’ Faber said. ‘There is this argument being said lately that, 好, maybe he won’t comply with that. Then we would have a situation where they could put him in jail.

    伊隆·马斯克(Elon Musk), 51, sent a letter to Twitter on Friday saying he was pulling out of the controversial deal he made in April to buy the platform for $54.20 每股, 要么 $44 billion in total

    伊隆·马斯克(Elon Musk), 51, sent a letter to Twitter on Friday saying he was pulling out of the controversial deal he made in April to buy the platform for $54.20 每股, 要么 $44 billion in total

    Faber’s co-host Carl Quintanilla laughed at the notion and called the idea of Musk going to jail over the deal ‘funny.

    ‘I know you laugh, but that’s where we could end up,’ Faber said. ‘This is a man who doesn’t play by the rules.

    Faber said on the show Monday that there has been ‘no evidence presented thus far in any way to enhancehis accusations about Twitter’s number of fake accounts, adding that he’d have to produce evidence in court.

    ‘Even if you were to prove that there were a higher number of bots, you still have to prove that it actually is a material adverse effect,’ Faber said.

    His co-host Jim Cramer responded to this saying that the Twitter board is in trouble if they just get that walk away.

    '他 (麝香) spent a lot of time, and his team has spent a lot of time with management going over very strong periods of open store, meaning that Musk really felt that they had gotten a really good look at it. So that is going to hold against them. I still think the likelihood that they get some sort of price cut is good. 男孩, the board is in trouble if they just get that walk away.

    The entire saga has left observers baffled by what Wedbush analyst Dan Ives described as ‘one of the craziest business stories ever.

    ‘I think it starts off as a circus show and it’s ending as a circus show,’ Ives told AFP.

    ‘For Twitter this fiasco is a nightmare scenario,’ Ives said, comparing the battle to an ‘Everest-like uphill climbor a ‘Games of Thrones’ 战斗.

    麝香, who also heads SpaceX, has accused the social media giant of ‘false and misleading representationsabout the number of fake accounts on its platform.

    His lawyers also point to recent Twitter employee layoffs and hiring freezes, which they say are contrary to the company’s obligation to continue operating normally.

    Ann Lipton, a professor of law at Tulane University who specializes in corporate litigation, says ‘it’s not enough, unless he can show that the representations are not just false, but also that they dramatically call the fundamentals of the deal into question.

    ‘Looks very much like Musk is legally wrong.

    Those arguments may be valid, but they do not merit pulling out of the deal, says Lipton, dismissing them as ‘nitpicky.

    But another expert argued that Twitter is better off without the billionaire.

    ‘It feels like a toy that a spoiled kid wants, but doesn’t really know what to do with, so he would get bored of it, and not give it the attention it deserves, and forget it in a cornerTwitter would die off slowly and painfully,’ predicts Creative Strategies analyst Carolina Milanesi.

    ‘Twitter is worse off than six months ago, but in the long run, it’s better off without him,’ Milanesi says.

    Wedbush analyst Dan Ives said this 'fiasco is a nightmare scenario' for Twitter as shares fell to $34.64 at Monday's opening bell and 34.39 later in the day

    Wedbush analyst Dan Ives said this ‘fiasco is a nightmare scenariofor Twitter as shares fell to $34.64 at Monday’s opening bell and 34.39 later in the day

    麝香, the founder of electric car company Tesla, sent a letter to Twitter on Friday saying he was pulling out of the controversial deal he made in April to buy the platform for $54.20 每股, 要么 $44 billion in total.

    Such merger agreements are ‘designed to prevent buyers from getting cold feet and deciding they want to walk away,’ law expert Lipton explained.

    Besides Musk’s accusations of Twitter’s ‘false and misleading representationsof the number of fake accounts, lawyers also point to recent Twitter employee layoffs and hiring freezes, which they say are contrary to the company’s obligation to continue operating normally.

    Those arguments may be valid, but they do not merit pulling out of the deal, says Lipton, dismissing them as ‘nitpicky.

    That leaves the possibility that the multi-billionaire is actually trying to renegotiate the price down.

    This tactic has been used successfully elsewhere, such as by LVMH. 两年前, the global luxury giant broke off a deal to acquire Tiffany before getting a discount.

    But experts don’t see how Musk and Twitter could agree on a different price at this point, given that the platform’s stock has lost more than a quarter of its value since late April.

    ‘Both have a lot to lose,’ Lipton points out.

    If Twitter wins in court, the mercurial entrepreneur will, at a minimum, have to pay a few billion dollars in damages.

    最坏的情况, he could be forced to honor his commitment and buy Twitter at a price that has become exorbitant, while his fortune has melted down by tens of billions of dollars in recent months.

    But though this would be a victory for shareholders, it would still leave Twitter in Musk’s handsand his libertarian vision of absolute free speech is not aligned with that of many of the employees, users and advertisers on whom the platform’s business model depends.

    Any court proceedings are expected to last for months, especially since Musk ‘will drag it out,’ according to Lipton.

    ‘Twitter is in a strong position,’ 她说.

    麝香, seen here in April 2022, looks to be in the weaker position from a legal standpoint as he tries to pull out of buying Twitter -- but can still wreak havoc on the social network as he goes

    麝香, seen here in April 2022, looks to be in the weaker position from a legal standpoint as he tries to pull out of buying Twitterbut can still wreak havoc on the social network as he goes

    亿万富翁伊隆马斯克控制推特的时间表

    一月 31: 马斯克开始以几乎每天的分期付款方式购买 Twitter 的股票, 积累一个 5% 3月中旬前持有公司股份.

    游行 26: 麝香, 谁有 80 百万 Twitter 追随者,并在该网站上活跃, 说他正在认真思考’ 构建 Twitter 的替代品, 质疑平台上的言论自由以及 Twitter 是否正在破坏民主. 他还私下联系 Twitter 董事会成员, 包括他的朋友和推特联合创始人杰克·多尔西.

    游行 27: 在私下告诉他们他在公司不断增长的股份后, 马斯克开始与 Twitter 首席执行官和董事会成员就可能加入董事会进行对话. 马斯克还提到将 Twitter 私有化或成立竞争对手, 根据后来的监管文件.

    四月 4: 一份监管文件显示,马斯克在收购一家公司后迅速成为 Twitter 的最大股东。 9% 赌注, 要么 73.5 百万股, 价值约 $3 十亿.

    四月 5: 马斯克获得推特董事会席位,条件是他积累的数量不超过 14.9% 公司股票. 首席执行官 Parag Agrawal 在一条推文中表示,“我们很清楚,他将为我们的董事会带来巨大价值。’

    四月 11: Twitter CEO Parag Agrawal 宣布马斯克毕竟不会加入董事会.

    四月 14: Twitter 在一份证券文件中透露,马斯克已提出以约 $44 十亿.

    四月 15: Twitter董事会一致通过“毒丸”’ 为回应马斯克的提议进行辩护, 试图阻止敌意收购.

    四月 21: 马斯克排队 $46.5 十亿融资收购推特. Twitter董事会面临谈判压力.

    四月 25: 马斯克达成收购推特的协议 $44 亿并将公司私有化. 这位直言不讳的亿万富翁表示,他想拥有 Twitter 并将其私有化,因为他认为 Twitter 没有发挥其作为言论自由平台的潜力.

    四月 29: 马斯克卖得差不多 $8.5 价值 10 亿美元的特斯拉股票,用于资助购买 Twitter, 根据监管文件.

    可能 5: 马斯克加强了他收购推特的提议,承诺超过 $7 来自不同投资者群体的数十亿美元,包括像甲骨文联合创始人拉里埃里森这样的硅谷重量级人物.

    可能 10: 暗示他将如何改变推特, 马斯克表示,他将在 2018 年 1 月 1 日之后撤销 Twitter 对前总统唐纳德特朗普的禁令。. 6, 2021 国土安全和紧急事务管理局的照片显示,国民警卫队周六在该地区散开. 国会大厦, 称禁令是“道德上错误的决定”’ 和‘愚蠢至极。’

    可能 13: 马斯克表示,他收购 Twitter 的计划是 ‘ 暂时搁置。’ 马斯克表示,他需要查明社交媒体平台上垃圾邮件和虚假账户的数量. 推特股价暴跌, 而特斯拉股价大幅反弹.

    六月 6: 马斯克威胁要结束他的 $44 亿收购推特的协议, 指责该公司拒绝向他提供有关其垃圾邮件机器人帐户的信息.

    七月 8: 马斯克告诉推特他正在终止协议,因为公司不会交出关于垃圾邮件机器人的信息

    广告

    But Musk, followed by more than 100 平台上百万人, ‘will try to embarrass themit will be distracting and demoralizing for employees,’ 她争辩说.

    He has already harassed the platform with highly critical tweets, mockery and outlandish suggestions, encouraged by his many fans.

    For Twitter, ‘it’s going be a battle on all frontskeeping employees, competitors going after their business, brand issues, investors believing the numbers,’ says Ives, the Wedbush analyst.

    Unlike its Silicon Valley neighbors, Twitter has never been a money-making machine, able to turn usersattention into astronomical advertising revenues.

    ‘The past few months have been a huge distraction for Twitter, keeping it from focusing on its business fundamentals,’ notes Debra Williamson of eMarketer.

    ‘If Musk is able to terminate the deal, Twitter will still be left with the same problems it had before he came on the scene,’ 她说.

    ‘Its user growth is slowing. And while ad revenue is still growing marginally, Twitter is now dealing with a slowing economy that could squeeze ad spending on all social platforms.

    Valued at $54.20-a-share when Musk and Twitter initially drew up the deal, Twitter’s share price has since fallen to $34.64 at Monday’s opening bell, 一种 6.3 percent drop from Friday’s close.

    The loss sets the pace for Twitter’s biggest drop in nearly two months, as trading begins again Monday and investors gear up for an inevitable legal battle between Musk and the social media giant.

    Twitter is set to file a lawsuit against Musk this week in Delaware’s chancery courts, which generally deal with business matters in hearings with no jurors.

    Bosses want to force him to complete the deal. He could also be ordered to pay a settlement amount, or could swoop in with a lower offer now Twitter’s value has tanked.

    Musk backed out of his blockbuster deal on Friday, citing the company’s refusal to hand over information on the number of fake accounts on its site as the reason for the break-up.

    推特, 与此同时, has argued that it’s provided Musk a ‘firehoseof raw data on hundreds of millions of tweets since he raised the issue again last month, after bringing it up upon the deal’s inception in April.

    Twitter has said for years in regulatory filings that it believes about 5 percent of the accounts on the platform are fake.

    Musk agreed to a $1 billion break-up fee as part of the buyout agreementand Twitter CEO Parag Agrawal and the company have since made it clear that they are preparing for a legal fight to force the sale.

    New York tax lawyer Robert Willens, however says that if Musk only has to fork over the fraction of the sum, since the South African mogul can write the payment off as a capital loss, to offset gains garnered by Musk during the fiscal year.

    ‘It’s good to keep in mind that the payment would be treated as a capital loss, 哪一个 [麝香] can use to offset capital gains, he realized upon his recent sales of some of his portfolio holdings,’ Willens told MarketWatch Friday of the prospective fine.

    ‘If that capital loss can offset short-term capital gains, the real cost of the termination fee would be reduced by about 40 percent of its face amount.

    The sell-off seen over the weekend, 与此同时, 建议, 强烈, that Wall Street has serious doubts that the deal will go forward as a legal battle looms.

    ‘This is going to be a long and ugly court battle (Twitter has already hired counsel) ahead in which the fake account/bot issue will be scrutinized for all to see and casts a dark cloud over Twitter’s head in the near term,’ Ives said Monday.

    ‘For Twitter this fiasco is a nightmare scenario and will result in an Everest-like uphill climb for Parag & 有限公司. to navigate the myriad of challenges ahead around employee turnover/morale, advertising headwinds, investor credibility around the fake account/bot issues, and host of other issues abound.

    Twitter on Sunday hired a heavy-hitting Delaware-based law firm to sue Musk for backing out of his $44billion deal to buy the company.

    这家社交媒体巨头引进了 Watchell, 立顿罗森 & 卡茨, 并计划在本周初对马斯克提起诉讼, 谁被指控共谋洗钱和违反反贿赂法.

    Musk agreed to a $1 billion breakup fee as part of the buyout agreement, although it appears Twitter CEO Parag Agrawal and the company are settling in for a legal fight to force the sale

    Musk agreed to a $1 billion breakup fee as part of the buyout agreement, although it appears Twitter CEO Parag Agrawal and the company are settling in for a legal fight to force the sale








    Wachtell 的聘用使公司能够接触到 Leo Strine 和 Bill Savitt 律师, who previously served as Chancellors of the Delaware Chancery Court.

    特拉华州的大法官法庭处理由被称为大法官的法官监督的非陪审团诉讼.

    他们经常处理业务纠纷, 与许多美国顶级公司 – 包括推特 – 将他们的公司总部设在那里, 即使他们的主要办公室在别处.

    衡平法院不能下令支付惩罚性赔偿, 并且通常比刑事审判更快地审理案件, Twitter的崩溃可能会在几个月内结束.

    马斯克聘请了伊曼纽尔·厄克特 & 沙利文律师事务所。, the firm that defended him in a 2019 诽谤案, and is currently representing him in a lawsuit related to Tesla.

    亿万富翁企业家兼特斯拉和 SpaceX 首席执行官在艾伦大会上登台亮相 & 公司太阳谷会议, 爱达荷州媒体和技术高管的年度聚会, 在他宣布终止他的工作后不到 24 小时 $44 亿美元收购推特公司.

    马斯克抵达大会, 被称为“亿万富翁”’ 夏令营,’ 本周的非记录活动引起了震动, 头条新闻通常发生在媒体窥探之外.

    采访由 Sam Altman 主持, OpenAI 首席执行官, 一家人工智能研究公司, 由马斯克和其他几个人资助, 正如世界首富讨论未来火星上存在生命的可能性, 但对推特保持沉默.

    “这似乎是一团糟,’ 一位高级媒体主管说, 谁在采访前不愿透露姓名. “这家伙制定了自己的规则 … 我不想成为推特, 你必须认真对待这个人。’

    太阳谷通常像 Met Gala 的运动休闲版一样被覆盖, 摄影师捕捉到了身着羊毛背心的媒体大亨和记者们在酒店的 Konditorei 咖啡馆记录电力午餐.

    今年, 五天, 仅限邀请的会议, 从七月开始运行 6 至 10, was held at the edge of Idaho’s Sawtooth National Forest in a tiny town of just 1,500 人.

    周五,一位好莱坞的权力掮客表示希望马斯克的采访能够让会议的沉稳气氛活跃起来, 今年的大脑气氛.

    在马斯克宣布之后, 一位首席执行官注意到房间里的大象 – 周六的讲话可能会让两位与会者感到不舒服: Twitter CEO Agrawal and Chief Financial Officer Ned Segal.

    马斯克向阿格拉瓦尔发出的最后一条公开信息之一是一条便便表情符号的推文,以回应 Twitter 首席执行官对公司如何解释垃圾邮件机器人的辩护。.

    目前尚不清楚马斯克是否在爱达荷州的活动中遇到了阿格拉瓦尔或西格尔.

    还参加了一年一度的艾伦 & 联合太阳谷会议, 在爱达荷州, 是 Twitter 首席执行官 Parag Agrawal (剩下), 星期三和他的妻子一起来的, 维内塔

    还参加了一年一度的艾伦 & 联合太阳谷会议, 在爱达荷州, 是 Twitter 首席执行官 Parag Agrawal (剩下), 星期三和他的妻子一起来的, 维内塔

    马斯克的律师向推特递交了一封长达八页的信, 说他计划取消收购社交网络的交易.

    文件, 向证券交易委员会提交, 据称 Twitter 在过去两个月中未能回应反复的信息请求, 或在采取可能影响其业务的行动之前征得他的同意 – 例如解雇两名关键高管.

    专家推测此举可能是为了压低价格. 马斯克最初提出 $54.20 4月每股, 但价格下降到 $36.81 周五晚上.

    布雷特·泰勒, 推特主席, 周五,董事会在推特上“致力于完成交易”’ 根据目前的交易条款,他们“有信心’ 他们会赢.

    Twitter has hired prominent New York law firm Wachtell, Lipton, 罗森 & Katz in preparation for a court battle over the ditched Elon Musk purchase deal

    Twitter has hired prominent New York law firm Wachtell, Lipton, 罗森 & Katz in preparation for a court battle over the ditched Elon Musk purchase deal

    迈克·林格勒律师 – 为马斯克表演 – 声称 Twitter 严重违反了该协议的多项条款.

    在提交给 SEC 的文件中, 林格勒写道: '先生. 马斯克正在终止合并协议,因为 Twitter 严重违反了该协议的多项条款, 似乎做出了虚假和误导性的陈述,. 马斯克在签订合并协议时依赖, 并可能遭受公司重大不利影响.

    '虽然部分 6.4 合并协议要求 Twitter 向 Mr.. 马斯克和他的顾问先生的所有数据和信息. 马斯克要求“出于与完成交易相关的任何合理商业目的,’ Twitter 未遵守其合同义务.

    “近两个月, 先生. 马斯克一直在寻找必要的数据和信息,以“对 Twitter 平台上虚假或垃圾邮件账户的普遍性进行独立评估。’

    “这些信息对 Twitter 的业务和财务业绩至关重要,是完成合并协议所设想的交易所必需的,因为它是确保 Twitter 满足关闭条件所必需的, 方便先生. 马斯克对交易的融资和财务规划, 并参与企业的过渡规划.

    “推特未能或拒绝提供此信息. 有时推特忽略了先生. 马斯克的要求, 有时它会以看似不合理的理由拒绝他们, 有时它声称遵守,同时给予先生. 马斯克信息不完整或无法使用。’

    马斯克此前曾威胁要停止交易,除非该公司证明垃圾邮件和机器人账户少于 5 在社交媒体服务上看到广告的用户百分比.

    Early Monday, Musk took to Twitter to mock the social media company for taking him to court for backing out of the deal, offering a series of memes.

    马斯克长期以来一直表示,他认为 Twitter 对平台上虚假账户的数量不诚实

    马斯克长期以来一直表示,他认为 Twitter 对平台上虚假账户的数量不诚实

    在第二个帖子中, 马斯克在推特上发布了一张模因传奇和动作明星查克·诺里斯下棋的照片

    在第二个帖子中, 马斯克在推特上发布了一张模因传奇和动作明星查克·诺里斯下棋的照片

    The billionaire shared one showing a picture of Chuck Norris at a chess board with one pawn confidently staring down a full set of black pieces.

    Another appeared to poke fun at the social media giant for taking legal action because it means they will have to disclose their spam bot details that he wants.

    这一系列评论与他在右侧歇斯底里地大笑的照片一起分享.

    标题阅读: “他们说我买不起推特; 然后他们不会透露机器人信息; Now they want to force me to buy Twitter in court; 现在他们必须在法庭上披露机器人信息。’

    马斯克的决定可能会导致这位亿万富翁与这家拥有 16 年历史的旧金山公司之间的长期法律纠纷.