A version of this article first appeared in the “Reliable Sources” newsletter. You can sign up for free right here.
Who wants to own Twitter? Maybe Elon Musk doesn’t. Sure, maybe he is causing chaos to extract a lower price from the Twitter board, but he just as well may walk away altogether and create a Twitter clone. There is a “60%+ chance from our view Musk ultimately walks from the deal and pays the breakup fee,” analyst Dan Ives said Tuesday.
But for now the board is trying to hold him to it. On Tuesday morning, hours after Musk tweeted that “this deal cannot move forward” until his purported spam bot concerns are cleared up, the company filed its proxy statement for Musk’s takeover and said it wants to close the deal “as promptly as practicable.”
The board, in other words, wants to rid itself of Twitter. I obtained a new statement from the board Tuesday night that read, “The Board and Mr. Musk agreed to a transaction at $54.20 per share. We believe this agreement is in the best interest of all shareholders. We intend to close the transaction and enforce the merger agreement.” Key words: “Enforce the merger agreement.” Legal action seems likely.
But what if Musk pays to make this deal go away? What will become of the social network the media loves to hate? “Since it seems there’s a decent chance Elon pulls out of the Twitter deal, who else would be in line to buy up the pieces (at a much bigger discount)? My white knight guess is Microsoft,” Techdirt’s Mike Masnick wrote Tuesday. He said “I think that at the end of this process, it will be difficult for Twitter to remain an ongoing concern as its own entity” because “the board clearly has no clue what to do with it…”
On the inside
Twitter employees are feeling every conceivable emotion – exhaustion, defensiveness, protectiveness, and all the rest. Some of it is evident on Twitter. Lara Cohen, Twitter’s global head of partners, tweeted about Musk without naming him, saying “The way some media outlets cover him, and do headlines just bc he ‘said’ something (whether it’s legal or factually accurate or possible or not) is SO trump 2016 coverage it’s painful to watch.”
Matt Levine’s must-read column
It’s titled “Elon Musk Does Not Care About Spam Bots.” The Bloomberg Opinion columnist said “it is important to be clear” that Musk “is lying:” Disputes about spam bots “are not why he is backing away from the deal, as you can tell from the fact that the spam bots are why he did the deal.”
“Twitter could get all 229 million of its monetizable daily active users in a room and have them say ‘hello Elon, we are real,’ and that would not convince him, because he does not want to be convinced,” Levine wrote. “He wants to pay a lower price…”