On Thursday, April 14th, Elon Musk announced an connection to bargain Twitter for $54.20 a share. On April 25th, Twitter accepted the deal. By July 8th, Musk wanted out. Then, Twitter sued Musk. For a while, it appeared we were headed for Chancery Court successful Delaware for a five-day proceedings successful October that volition find who owns Twitter. Then, astatine the past moment, it appeared Musk mightiness conscionable bargain Twitter and enactment an extremity to each this.
This is simply a immense communicative with a batch of fast-moving parts to it. It’s besides a communicative that volition apt agelong retired implicit the adjacent fewer months, possibly adjacent longer. So we thought we’d enactment unneurotic a usher for you, our readers, that tin beryllium updated arsenic things proceed to unfold. Because, like Elon, we ❤️ you.
So strap in. It’s going to beryllium a bumpy ride.
The latest news:
On October 4th, Bloomberg reported that Musk sent different connection missive to bargain Twitter astatine the archetypal price: $54.20 a share. That would mean, essentially, that aft each this, and without going to trial, Musk is consenting to conscionable springiness up and spell up with the acquisition.
The timing of the caller connection is strange, arsenic is the information that Musk didn’t connection immoderate big-but-not-as-big fig to effort and settee the woody erstwhile and for all. It did travel conscionable earlier Musk was scheduled to beryllium deposed, though, and conscionable aft a slew of embarrassing texts betwixt Musk and his billionaire friends came out. Twitter’s stock terms instantly spiked connected the news.
An exigency proceeding connected the woody is presently reportedly scheduled for aboriginal connected Tuesday.
Jack Dorsey, Joe Rogan, Larry Ellison, Jason Calacanis — Musk texted with a immense fig of radical astir the Twitter deal, and the merchandise of galore of those texts gave america immoderate penetration into however the woody came unneurotic and fell apart.
Things got peculiarly messy, it appears, erstwhile existent Twitter CEO Parag Agrawal asked Musk to halt tweeting damaging things astir the company. That’s erstwhile Musk instantly decided not to articulation the committee and launched his program to instrumentality it private. Dorsey loved the idea; Calacanis had a batch of weird ideas astir it; everybody was falling implicit themselves to springiness Musk wealth to marque it happen. The texts are weird and hilarious and precise overmuch worth a read.
The remainder of the communicative truthful far:
Musk’s lawyers person present sent 3 letters to Twitter attempting to terminate his statement to bargain the company. This time, they cited Twitter’s multimillion-dollar severance outgo to Zatko, saying it was a usurpation of the merger statement and a crushed to extremity the deal.
A fewer days later, Twitter responded the mode it ever does: your statement is invalid, Twitter hasn’t breached its broadside of the deal, and truthful you can’t either.
In aboriginal September, Delaware Chancellor Kathaleen McCormick said that Musk’s broadside tin see Zatko’s claims successful its lawsuit but denied yet different effort to hold the trial. “I americium convinced that adjacent 4 weeks’ hold would hazard further harm to Twitter excessively large to justify,” McCormick said. And arsenic we proceed to larn much astir the encephalon drain happening astatine Twitter, it seems she mightiness beryllium right.
Musk and his squad tried to usage Zatko’s revelations astir Twitter this arsenic a accidental to maybe, really get retired of the deal. His lawyers filed a caller “Termination Letter” with the SEC connected August 29th, which cites Zatko’s grounds arsenic grounds that Twitter misled Musk successful the parties’ merger agreement. Specifically, Musk claims that Twitter’s declaration successful the merger statement that it had not misled the SEC is false. Twitter responded saying basically, nope, we haven’t breached immoderate of our agreement.
Peter “Mudge” Zatko was fired successful aboriginal 2022 from his presumption arsenic Twitter’s caput of security. In July, helium filed a whistleblower study saying Twitter has hidden negligent information practices, misled national regulators astir its safety, and failed to decently estimation the fig of bots connected its platform. Zatko is a long-tenured and well-respected voice successful the hacker and information community, and his allegations are definite to person a immense interaction successful and retired of Twitter. Congress, for one, has already said it is investigating Zatko’s claims.
Zatko’s disclosure says straight that Twitter lied to Musk astir its spam and bot measurements, which could beryllium fodder for Musk’s complaints astir spambots, though Zatko’s enactment for those peculiar allegations feels reasonably thin. Twitter denied each the accusations, calling them “a mendacious narrative.”
The subpoenas up of the proceedings person go a who’s who of the tech industry, including Dorsey, Larry Ellison, Marc Andreessen, Tesla, Keith Rabois, and galore others. Dorsey was a astonishment but seems apt to person plentifulness of pertinent information, fixed some his tenure arsenic Twitter CEO and the information that Dorsey reportedly pushed hard to person Musk to bargain the institution successful the archetypal place.
The financing operation of Musk’s Twitter acquisition has shifted implicit time, but adjacent aft promising successful April that “no further TSLA income planned aft today,” Musk sold different immense batch of his shares. “In the (hopefully unlikely) lawsuit that Twitter forces this woody to adjacent *and* immoderate equity partners don’t travel through,” helium tweeted soon after, “it is important to debar an exigency merchantability of Tesla stock.”
Musk’s broadside wanted much time and for the proceedings to commencement successful February 2023. Twitter wanted it to commencement arsenic soon arsenic possible. Chancellor McCormick, who volition oversee the trial, said the proceedings volition commencement connected October 17th and volition past 5 days. Of course, that assumes the 2 sides don’t settle, and that remains anyone’s guess.
Twitter appears to beryllium already feeling the Musk Effect: erstwhile it reported net successful July, the institution said its gross fell for a assortment of macroeconomic reasons but besides due to the fact that of what it described arsenic “uncertainty related to the pending acquisition of Twitter by an affiliate of Elon Musk.” One happening Twitter won’t springiness Musk recognition for? Its idiosyncratic growth. The work reported reaching much than 237 cardinal regular users, up from 229 cardinal past quarter. That, of course, was owed to “ongoing merchandise improvements.”
We wouldn’t usually archer you it’s worthy speechmaking a 162-page ineligible filing that gets heavy into the weeds of bot measurement procedures. But this lawsuit has been filled with abnormally spicy ineligible fighting, overmuch of which was intelligibly written to beryllium work by a wide audience. It’s a bully yarn.
Almost arsenic soon arsenic Musk made wide his intentions to get retired of buying Twitter, Twitter filed a suit that said, successful effect: you agreed to wage $44 cardinal for Twitter, and we mean to get each $44 cardinal for our shareholders. Twitter filed its suit successful the Delaware Court of Chancery, which instantly became the astir breathtaking judicial strategy cipher had ever heard of. It paints a representation of Musk going retired of his mode to marque an unexpected and unusually generous connection to Twitter, lone to astir instantly crook astir and commencement toying with the institution and the thought of abandoning their agreement.
It looked similar it was going to happen, and past it did: lone weeks aft announcing his volition to bargain Twitter, Musk tried to get retired of it. Musk’s squad claimed helium was terminating the woody due to the fact that Twitter was successful “material breach” of their statement and had made “false and misleading” statements during negotiations. In particular, Musk was acrophobic astir the prevalence of fake oregon spam accounts connected Twitter and what helium saw arsenic Twitter’s reluctance to beryllium its ain probe connected the subject.
Musk joined a virtual municipality hallway with Twitter employees and attempted to reply their questions astir the aboriginal of the institution and platform. He offered vague answers astir wanting to emulate WeChat and larn from TikTok and letting radical work from location much often portion saying Twitter would pull 1 cardinal users. Meanwhile, helium hinted that significant layoffs could beryllium successful the company’s future.
After a fig of cagey tweets and “just asking questions” sorts of moves, Musk’s ineligible squad made its archetypal authoritative menace to backmost retired of the acquisition. In a ineligible filing, they claimed that Twitter failed to supply Musk with accusation connected the service’s spam bot occupation and that he’s entitled to person that accusation nether the woody agreement. Twitter, they wrote, was actively preventing him from getting the accusation helium needed.
“My connection was based connected Twitter’s SEC filings being accurate,” Musk tweeted, referencing Twitter’s oft-cited number that little than 5 percent of the accounts connected the level were fake oregon spam. “Yesterday, Twitter’s CEO publically refused to amusement impervious of <5%. This woody cannot determination guardant until helium does.” Musk’s vexation appeared to beryllium wholly beside the constituent and the benignant of happening helium should person raised before signing a binding statement to bargain the company. But it was wide that if Musk decided helium did want out, this would beryllium his way.
The turmoil wrong Twitter wasn’t conscionable coming from Musk and his ineligible team. Parag Agrawal, the still-new CEO of the company, fired immoderate of his apical executives, including user merchandise person Kayvon Beykpour and Bruce Falck, the wide manager of gross and caput of merchandise for its concern side. “The priorities and decisions we marque present volition not lone bolster however we navigate done this time,” Agrawal said successful a memo to Twitter’s staff, “but besides for the longer-term occurrence of Twitter which I attraction astir deeply.”
One different large Twitter-under-Musk question is what he’ll bash astir the platform’s imperishable prohibition connected Donald Trump. Musk said during a Financial Times conference that he’d undo it. “I conjecture the reply is I would reverse the permaban,” helium said, “obviously I don’t ain Twitter yet, truthful it’s not a happening that volition decidedly hap due to the fact that what if I don’t ain Twitter?”
Could Twitter Blue beryllium the aboriginal of Twitter? Musk thinks so. He believes helium tin crook Twitter subscriptions into a $10 cardinal concern by 2028, which would beryllium treble the full company’s existent revenue. Of course, that besides includes immense idiosyncratic growth: Musk estimated Twitter could person 600 cardinal users successful 2025 and 931 cardinal successful 2028. That’s a large leap from the company’s existent harvest of 217 cardinal users.
On April 25th, Twitter’s committee of directors accepted Musk’s connection of $54.20 per share, oregon $44 billion, for full power of the company. It was the aforesaid terms helium named successful his archetypal connection connected April 14th. Upon completion of the transaction, Twitter volition go a backstage company. Musk began moving to enactment up financing for the woody and sold 9.6 cardinal of his Tesla shares to escaped up astir $8.4 billion.
Hours aft announcing his bid to bargain Twitter, Musk was connected signifier successful Vancouver for a well-timed interrogation with TED Talk laminitis Chris Anderson. During the conversation, Musk spoke astir his “obsession with the truth” and echoed comments helium made successful his SEC filing astir wanting to support escaped code and democracy.
Musk whitethorn beryllium successful for a rude awakening if helium is capable to bargain Twitter
But arsenic Adi Robertson pointed out, his knowing of escaped code appears to beryllium nebulous astatine best. After examining Musk’s comments, arsenic good arsenic erstwhile efforts by Twitter’s enactment to contend with code laws astir the world, she concluded that Musk whitethorn beryllium successful for a rude awakening if helium succeeds successful buying the societal media platform.
Twitter’s archetypal all-hands gathering aft Musk’s bid went nationalist was a weird one. After serenading employees with Backstreet Boys and Aretha Franklin, the institution said it would proceed to measure the offer.
Employees told The Verge’s Alex Heath they were frustrated by the deficiency of a much elaborate response. They’re acrophobic astir the aboriginal of the societal media platform, arsenic good arsenic the anticipation of layoffs.
Musk is simply a precise affluent guy. So, naturally, helium would accidental that helium isn’t funny successful buying Twitter to marque money. He views Twitter arsenic the “de facto municipality square” and wants to unfastened root the societal media company’s algorithm. He tried to framework the full takeover bid arsenic immoderate benignant of crusade to support escaped speech.
But adjacent a escaped code maximalist similar Musk needs to person shareholders that his buyout connection is successful their fiscal self-interest. Otherwise, what are we truly doing here?
Anyone who’s been successful the marketplace to bargain a location knows astir “best and final” offers. In his opening salvo, Musk claimed his bid to bargain Twitter was precisely that. He was offering Twitter’s shareholders a beauteous just premium: $43 cardinal for a institution with a $37 cardinal marketplace cap.
Musk said that Twitter indispensable spell backstage successful bid to acquisition the changes that request to beryllium made. These included an edit feature, an open-source algorithm, little moderation, and a higher barroom for removing offending tweets.
After quality broke that Musk had acquired 9.1 percent of the company’s shares, galore radical concisely entertained the conception that Musk mightiness effort to bargain the full company, lone to yet reason helium had already gotten everything helium wanted retired of Twitter.
Casey was close successful positing that Twitter’s poison pill provisions whitethorn not beryllium capable to halt Musk. But helium besides assumed that Musk would conscionable proceed to troll the institution done his tweets.
After declining a spot connected Twitter’s board, Musk updated his filing with the Securities and Exchange Commission to bespeak that helium would not beryllium a passive subordinate successful the company’s affairs. Gone was the connection that helium would restrict his holdings to conscionable 14.0 percent of the company. In retrospect, this was the archetypal hint that helium whitethorn effort thing much impactful than conscionable buying immoderate banal of serving arsenic a committee member.
A 1000 years ago, connected April 4th, 2022, Elon Musk announced that helium had purchased 9.1 percent of Twitter. The quality that the world’s richest antheral was present (briefly) the largest shareholder successful his preferred societal media level sent the banal terms soaring and galore a keyboard a-typing.
Musk instantly acceptable astir soliciting suggestions astir ways to amended Twitter by — what other — tweeting a poll. The institution responded by offering him a committee seat, a determination that would person restricted him to owning conscionable 15 percent of the company. At first, helium said yes. Then helium changed his caput and said no. Meanwhile, our nonmigratory Twitter and Musk experts, Casey Newton and Liz Lopatto, respectively, dug deeper into wherefore Musk was flirting with Twitter and what the apt outcomes would be.