Twitter: Another about-face from Musk
Elon Musk has cold feet, said Rishi Iyengar and Allison Morrow in CNN.com. The world’s richest person raised doubts this week about his commitment to the $44 billion takeover of the social media company Twitter, saying the deal “cannot move forward” until the company provided proof that less than 5 percent of Twitter accounts were fake. But this issue is not new; Musk has “repeatedly spoken out against bots and spam accounts.” In fact, he has said solving the issue was a reason he was buying Twitter. Musk’s sudden antagonism, and suggestions that Twitter’s numbers were fraudulent, signals he is seeking a do-over, with Twitter’s stock “trading well below his offer price of $54.20 per share.”
Legally, Musk can’t just announce that a done deal is “on hold,” said Therese Poletti in MarketWatch. “The two sides have a contract and it is legally enforceable.” But how far can Twitter go? It could just “ignore Musk’s actions” and “continue forward with the deal,” hoping
Musk changes his mind again. It could also sue him under a “specific performance” clause that would attempt to “force him to go through with the acquisition.” Twitter owes its shareholders “every cent it can pull out of Musk’s pockets after what he has put the company, its investors, and its employees through.” But if the deal falls through, there’s a good chance Twitter will have to settle for the relatively meager $1 billion breakup fee.