In less than two weeks, Elon Musk was scheduled to face Twitter in the Delaware Court of Chancery. Suddenly, the $44 billion takeover that neither side particularly wants is back on the table.
What does the diverse group of investors who have offered Musk their support have to think of the recent reversal? If Twitter accepts Musk’s offer to buy the microblogging site at the original price of $54.20 per share, they will avoid getting dragged further into the litigation.
This threatened to add to the uneasiness sparked by the release of humiliatingly caring text messages to Musk. For example, Jason Calacanis wrote: “You have my sword . . . Twitter CEO is my dream job.”
Musk’s apparent inability to prove that more than 5 percent of Twitter users are fake meant he had little chance of winning. Now his plan to fix Twitter is coming back into focus. Can he turn Twitter into a profit-making machine that co-founder Jack Dorsey failed to do?
He can hardly make it worse. Twitter is riddled with spam and relies on poorly targeted ads to generate revenue. The monetizable daily user count is less than a tenth that of Meta.
Regardless, it remains extremely popular with influential people who enjoy sharing their thoughts directly with the world. Musk himself continued to post on Twitter even as he tried to back out of the deal.
News released by the court suggests there is no profitability master plan. Investors like Oracle co-founder Larry Ellison offered billions of dollars without asking to see one. Saving “free speech” and meddling in a deal with Elon Musk were sufficient incentives.
Twitter shares rose 13 percent on the news before trading halted. They remain below their levels in April, when Musk first bid, and more than a tenth below his asking price. More wins are likely.
It was an unnecessary distraction for a man who already runs several companies, including $769 billion electric carmaker Tesla and $127 billion private rocket company SpaceX.
Users can be unhappy when Musk raises subscriptions. Opponents of hate speech and conspiracy theories will complain when he breaks loner permabans. Twitter’s management, including CEO Parag Agrawal, is unlikely to develop a working relationship with the new owner.
But a new price deal would not only benefit jaded Twitter investors. It would also show that US capitalism is robust enough to ensure tycoons stick to their side of a bargain, no matter how powerful or opinionated.
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https://www.ft.com/content/be17c16a-69ad-41a1-b011-2d008a5d86aa Twitter/Musk: Bidding at the agreed price would increase confidence in fair dealing