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Elon Musk needs to purchase Twitter for $44 billion. Once more.
The world’s richest man has reportedly instructed Twitter that he’d like to maneuver ahead with the deal he first agreed to in April: He needs to pay $54.20 a share for the messaging service.
The distinction between now and final spring, after all, is that within the interim Musk tried to stroll away from his signed contract to purchase Twitter. And that Twitter sued him to attempt to implement that deal, and that the 2 sides are at the moment in courtroom getting ready for a trial that’s scheduled to begin October 17 — lower than two weeks from now.
What modified? We don’t know but. We do know that Musk is at finest unpredictable and that we shouldn’t take something he says or does at face worth. Even when the 2 sides met in Delaware courtroom on Tuesday to debate the proposal, because the New York Instances has reported, it doesn’t imply it should undergo or that he received’t have one other reversal sooner or later.
Nonetheless, we will briefly recap how we acquired right here, and focus on the challenges Musk will face if he truly does find yourself proudly owning Twitter.
The tl;dr backstory: Final spring, Musk, certainly one of Twitter’s most prolific customers, amassed a 9 p.c stake in Twitter however mentioned he wasn’t planning on buying the service. Then he agreed to affix the corporate’s board, then determined he didn’t need to try this, after which introduced that he needed to purchase Twitter. The corporate first rejected his supply after which, after wanting round for a greater various, agreed to his phrases.
Inside weeks of that announcement, although, the marketplace for tech shares started sliding, as did the worth of Tesla shares — Musk’s main supply of wealth. Then Musk, who had introduced that certainly one of his objectives in buying Twitter was to rid it of bots he felt plagued the service, started complaining that Twitter may need too many bots and that the deal “couldn’t transfer ahead” till he acquired extra information about that. In July, Musk formally introduced that he needed out of the deal, after which Twitter sued him for breach of contract.
The truth that Twitter was making an attempt to power Musk to purchase an organization that initially didn’t need him as an proprietor, coupled with the truth that most authorized consultants believed that Musk had a poor authorized case, led to a standard knowledge amongst tech observers: Sooner or later, Musk would settle with Twitter, pay some form of multibillion-dollar penalty, and stroll away.
The present information wipes away that risk, for now. So we’re again to the query we began asking again in April: What’s going to Musk do with Twitter if he truly owns it?
Bear in mind, the explanation Twitter was out there for buy within the first place is that the messaging service appears crucial to not less than a slice of its 238 million lively customers, however has a enterprise that’s nowhere close to as large or precious as, say, Meta’s.
So with the intention to change that — and to make Twitter value not less than as a lot because the $44 billion Musk would shell out to personal the corporate — Musk would face main challenges: He’d have to discover a solution to improve its consumer base, minimize prices, and generate extra income.
But it surely grew to become clear, nearly instantly, that Musk didn’t have way more than a hunch about what he would do with Twitter if he owned it. An early proposal he floated to potential buyers final spring included completely fanciful notions, like discovering one other 750 million customers inside just a few years.
On the one hand: You need to positively take Elon Musk’s Twitter plans critically and actually.
Alternatively: Elon Musk says he’s going to extend Twitter’s consumer base from 217 million to 931 million. So possibly not a lot.
— Peter Kafka (@pkafka) Might 10, 2022
And the discharge final week of textual content messages Musk acquired and despatched final spring bolstered the notion that Musk, together with a few of his richest superfans, wasn’t positive precisely how Musk would do all of this — simply that they have been positive {that a} man who pioneered electrical automobiles and despatched rockets into area after which landed them again on earth might simply resolve Twitter.
Now — possibly — we’ll get an opportunity to see in the event that they have been proper, in any case.
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