Daily Crunch: Musk wants out of his $44B Twitter deal
July 11, 2022
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According to a new report from The Washington Post that relies heavily on anonymous sources, the world’s richest man is still looking for a way out of a $44 billion deal of his own making.
The Post reports that we’ll probably be seeing a “change in direction from Musk’s team” soon, according to its unnamed sources familiar with his plans. Further, Musk and friends have reportedly “stopped engaging in certain discussions” pertaining to funding the deal. Oracle co-founder Larry Ellison, Sequoia Capital, Andreessen Horowitz, Binance and Fidelity are all on board for financing after signing on in early May.
Musk appears to again be sowing doubt about Twitter’s bot estimates with these new shenanigans, but how and if those supposed concerns would even impact a deal he’s already signed onto is far from clear. The terms of the merger agreement include a stipulation that Musk would have to cough up $1 billion if he backs out of the deal, though it certainly looks like he’s combing through the fine print here looking for a way out of that too.
Musk has made a lot of noise in recent months with the claim that Twitter misled him about the number of bots and spam accounts running wild on the platform. Twitter hosted a press call Thursday to review its bot-counting methodology, which has long found that fewer than 5% of the platform’s accounts aren’t real people.
Musk offered to buy Twitter back in April and the company soon accepted the offer. After that — and after the economic winds shifted, taking his Tesla stock with them — the SpaceX and Tesla CEO claimed that the deal he already agreed to with Twitter was “on hold,” a status not corroborated by any filings or external realities beyond Musk’s tweets.
The whole thing seems like a thin charade for a guy hoping to weasel out of a badly timed acquisition. But unfortunately for Musk and the Twitter employees who’ve been on this multimonth acquisition roller coaster, the ink is already dry on the deal.
Last month, Musk participated in a companywide call with Twitter employees — a rare instance of actually engaging with the entity he’s on the hook to buy and a gesture that signaled he was moving forward with the deal he has to move forward with.
Since he began maneuvering to purchase Twitter this spring, a few things have changed. In the intervening time, markets dove off a cliff and reports surfaced that Musk exposed himself to a SpaceX flight attendant who later received a quarter of a million dollars in hush money. Oh, and Musk apparently recently fathered children with a Neuralink employee who reports directly to him — not exactly an inspiring leadership profile. Nonetheless, Musk is on track to take over at Twitter.
