(FiveNation.com)- Tesla CEO Elon Musk apparently has put his deal to purchase social media giant Twitter on hold while he awaits further information on the number of fake/spam accounts the platform has.
Many pundits have surmised that Musk is merely posturing to try to lower the purchase price and re-enter into negotiations.
Either way, reports have come out that the board of Twitter plans to “enforce the merger agreement,” even though Musk is playing hardball.
Dan Ives, an analyst, said earlier this week that he believes there’s a “60%+ chance from our view Musk ultimately walks from the deal and pays the breakup fee.”
What Ives is referring to is the supposed $1 billion penalty that Musk would have to pay if he doesn’t complete his purchase of the social media giant. That was part of the agreement the two sides signed a few weeks ago.
The Twitter board doesn’t seem to really care about what Ives is saying, or how Musk feels about the whole thing. They are going to work to hold him to his word and force him to complete the purchase.
On Tuesday, Musk tweeted that “this deal cannot move forward” until his concerns about spam bots are clarified.
Just a few hours after that, though, Twitter filed a proxy statement, saying they want to close this deal “as promptly as practicable.” Basically, the board of Twitter — while reluctant to work with Musk at first — now wants nothing to do with the company anymore.
Brian Stelter of CNN Business obtained a statement from Twitter’s board this week 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.”
If Musk puts a wrench in the deal, for whatever reason, it seems very likely that the Twitter board would proceed with legal action. Of course, the Tesla CEO could just pay the penalty and walk away from the deal altogether seemingly.
So, what happens in that case? Mike Masnick of Techdirt opined on that subject when he wrote:
“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 … 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.”
Top employees within Twitter don’t seem to know what the heck to do or how to feel about it all. The company’s global head of partners, Lara Cohen, went public with her feelings this week.
While she didn’t mention Musk by name, she was certainly referring to him when she tweeted:
“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.”