Should it be called The Musk Somersault? In a theatrical volte-face, Elon Musk, the planet’s wealthiest person, recently on May 13th declared his $44bn offer for Twitter would not move forward. He needed proof from the microblogging behemoth attesting spam bots are less than 5 per cent of its total users. All these happened on Twitter. Musk-watchers say this is nothing more than a delaying tactic. They say he is borrowing more time, either to drive the offer price down or to wriggle out of the deal totally.
A Load of Bull
Such speculation is gaining decibels for various reasons. Primarily, Musk could not have made an offer to buy Twitter without doing his due diligence on spam bots as these have a direct bearing on the platform’s revenue stream. Thus, Musk’s post-deal averment on spam bots making up at least 20 per cent of Twitter’s total users, and not 5 per cent as claimed by Twitter, cannot be anything but a load of bull. Musk went on to big-mouth later to say the spam-bot figure was in fact a stunning 90 per cent. Though Musk responded to Twitter CEO’s logical defence with a poop emoji, Musk-watchers insist Musk’s colourful claims and his constant toing and froing represent the real poop.
The ensuing fall in the Twitter stock later by more than 8 per cent bolsters the doubts Musk is exploring ways to sneak out of the deal. What about deal honesty then? What about sanctity of the spoken word?
As Musk raises stink over Twitter’s dalliance with spam bots, the ground reality reveals Musk’s offer price for Twitter is way higher than its market value. A good enough reason for Musk to keep dragging his feet. With the Twitter deal now impacting his other companies (Musk has pledged their shares to finance the buyout), Musk is definitely having a serious rethink on l’affaire Twitter.
If Musk succeeds in walking out of his Twitter deal, he would have to shell out a $1bn termination fee. In addition, the “specific performance clause” in the deal gives Twitter the right to sue and force him to complete the deal. Musk may view these punitive impositions as loose change. But, his shareholders are not going to and it will be a sobering thought.
Knowing Musk and his antics well, his somersaults aren’t surprising. They confirm his long-standing modus operandi and show him in poor light as an agent of anarchy. By the way, Musk is a self-confessed Asperger. Such deal uncertainties can hurt Twitter badly. What about erosion in Twitter’s value? What about wounded employee morale? Musk comes across as someone who doesn’t care. Executive exodus from Twitter has begun and Musk remains unmoved.
“I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy.” Musk said so in one of his SEC filings. In fact, as of now, Musk has succeeded in making Twitter a great free-speech opportunity for him to peddle his weasel justifications for continuing to keep one foot in and one foot out. There is a growing fear these shenanigans could set the Twitterati atwitter and turn Twitter into a free-for-all platform.