Buyout offer suspended then relaunched, trial adjourned but not (yet) canceled… The twists and turns in the case that has pitted Elon Musk against Twitter for several months are not always easy to follow. We summarize everything for you from the beginning.
The takeover offer
At the beginning of April, Elon Musk, at the head of Tesla or even SpaceX, revealed that he had acquired nearly 10% of the stock market value of the social network Twitter. The richest man in the world joins the company’s board of directors.
On April 14, he made an offer to buy back the entire company at a unit price of $54.20 per share. He indicates that it is “his best offer and his final offer”. She then values Twitter at around 44 billion dollars.
At first, Twitter is resisting its takeover offer. But the board of directors of the group ends up yielding and announces on April 25 a final agreement of takeover by the businessman of South African origin.
The first about-face
From mid-May, the affair became more and more murky. On May 13, the whimsical billionaire indicated that he was suspending the takeover because of his concern about the real number of fake accounts on the social network, causing the group’s share price to plunge by around 20%.
He threatens once again on June 6 to withdraw his offer because the social network “actively resists” his requests for information, which the platform denies. Finally, on July 8, the boss of Tesla and SpaceX informs Twitter that he is terminating the agreement because of “false and misleading statements” by the company on the fake accounts.
Twitter is suing Elon Musk
Twitter’s board of directors announced legal action to enforce the terms of the agreement. The lawsuits were launched on July 12 before a court specializing in business law. The president of the court grants the company a quick trial, against the wish of Elon Musk who wanted to request an astronomical amount of data from the social network.
The billionaire backpedals again
On October 4, less than two weeks before the trial which was to open on October 17, Elon Musk finally let it be known that he was relaunching his offer, at the price he had announced in April. On two conditions, however: that he obtains the necessary funds and that the board of directors puts an end to his pursuits.
The billionaire did not detail the reasons for his reversal, but some attribute it to the bad turn that the legal proceedings would take for him. Preliminary discussions at the trial seem to show the billionaire’s difficulties in substantiating his accusations about the proliferation of fake accounts. For Carl Tobias, professor of law at the University of Richmond, it is also possible that Elon Musk may have been embarrassed by the dissemination, within the framework of the procedure, of messages exchanged with other personalities from the business world and wished to avoid the publication of further messages.
Trial or no trial?
Twitter says it has taken note of Elon Musk’s decision and said it still “intends” to complete the transaction. But after months of public attacks and changes of heart on the part of the entrepreneur, the company wants sound and stumbling proof of its seriousness. His lawyers therefore opposed Thursday the adjournment of the trial claimed the billionaire.
But the judge in charge of litigation between Twitter and Elon Musk finally ruled in favor of the latter: she suspended the procedure until October 28. Both parties have until that date for the boss of Tesla to buy the social network, failing which the trial initially scheduled for in ten days will take place in November.
Negotiations between the two parties resumed at the beginning of the week, but they are stumbling over the financing condition. Elon Musk’s lawyers argued that the most likely outcome in their view would be “that the debt be funded”, in which case “shareholders will get their money much faster than if Twitter wins the lawsuit, and then the appeal (…) a process that could take months.” They expect the deal to close “around October 28”.
What future for Twitter?
The social network is not in its best shape. He saw his turnover decline by 1% in the second quarter, while employee morale is not looking good. The likelihood of a deal being struck with Elon Musk has rekindled serious concerns about a possible resurgence of abuse and misinformation on the platform.