Another trick from Elon Musk. Although he had given up on buying Twitter, it was by mail that he announced that he had changed his mind on Tuesday. Twitter’s price rose after the announcement, a sign that the transaction may well go through. With this acquisition announced, several parameters remain to be resolved and technical questions remain unanswered.
• Will the lawsuit between Musk and Twitter be carried out?
The initial showdown between Twitter and Elon Musk was going to play out of a trial scheduled for October 17. To desist from his acquisition of the social network, Elon Musk advanced the argument of the number of false accounts, estimated according to him at 20%when Twitter was based on the number of “monetizable” active users, and indicates 5% of fake accounts on this basis.
Eric Talley, a law professor at Columbia University, said the edge, that “the trial will not stop dead, it will continue (…) we will see if the judge authorizes the freezing of the procedure. The statements will continue until an agreement is reached.” Clearly, the trial will go ahead unless a deal is struck between Twitter and Musk. for October 17. Lawyers for both parties seek an agreement to avoid it. the Wall Street Journal reports that the judge asked Musk and Twitter to come up with a plan to end the trial.
• What conditions did Elon Musk set?
As indicated in techcrunchthis acquisition can only see the light of day on one condition set by Elon Musk: that the courts “immediately suspend Twitter’s legal action against Musk and cancel the lawsuit and all other proceedings,” he said in his letter. In other words, he is willing to go ahead with his action, as long as the trial does not continue. The Tesla boss agrees to pay the price of the initial agreement reached last April: 44,000 million dollars. For its part, Twitter declined to comment on the next steps in his trial to force Elon Musk to honor his end of the settlement, he reports. political.
• How does Twitter come out of this matter?
Following the announcement, shares of Twitter were suspended, before rising to 22% at the close of trading. However, Twitter did not immediately accept the offer. There is mistrust on both sides and Twitter is proceeding cautiously.
Twitter is a company that has never made money and its revenues fell in the second quarter, with a net loss of 270 million dollars. With the slowdown in the advertising market, the social network loses momentum despite the fact that it has 237 million users.
• Who will finance the operation?
Elon Musk will finance much of the takeover bid by selling his stake in Tesla. The main banks, such as Morgan Stanley and Bank of America, have committed to financing the operation for a sum of 12,500 million dollars. But Elon Musk’s change of course couldn’t have come at a worse time for banks that could suffer big losses, he notes. Reuters. The rise in interest rates linked to the current geopolitical context scares banks, which are more reluctant to invest in risky stocks.
• Will Elon Musk transform Twitter?
From his first takeover proposal, Elon Musk made it clear that he wanted less restraint, even wanting to revive Donald Trump’s account that was banned for inciting violence during the January 6, 2021 uprising in Washington. So the former president could rediscover his passion for tweeting just before the 2022 midterms and the 2024 general election. But Trump said it’s unlikely he’ll join Twitter since he launched his own Truth social network.
Beyond the question of moderation, Elon Musk wants above all transform Twitter into “an application for all uses”, without detailing a concrete economic strategy.
Source: BFM TV
