Tycoon Elon Musk, founder of the auto company Tesla, seeks to disassociate itself from the agreement to buy Twitter. The billionaire alleges that the social network provided inaccurate information about the amount of fake users that houses the platform of the blue bird, so its intention is to nullify the acquisition by $44 billion.
The comings and goings in the purchase of Twitter configure “one of the stories of business craziest in history”, synthesized Dan Ives, analyst at the firm of investments Wedbush, for the AFP agency. “I think it started as a circus show and it is ending like a circus show,” said the specialist.
The agreement between the social network and Elon Musk, also CEO of the aerospace company SpaceX, includes a clause that prevents this type of situation. Because of this part of the document, if either party breaks the agreement, they will have to pay a $1,000 fine.
What would be Twitter’s next steps against Elon Musk?
Musk also alleges that Twitter fired employees and stopped hiring, but this would not be so serious as to bring down the agreement. “It is not enough, unless he can show that the statements (about fake accounts) are not only false, but call into question the fundamental foundations of the agreement,” explained Ann Lipton, an expert in corporate litigation.
Therefore, one option is Elon Musk try to renegotiate a lower price. “Both have a lot to lose,” Lipton warns, as Twitter shares have fallen by more than a quarter in value since April.
Should the purchase go through, the libertarian vision of Musk it is a position with which many executives, users and advertisers of the social network do not agree. “Twitter it’s worse now than it was six months ago, but in the long run, it’ll be better off without it,” says Carolina Milanesi, an analyst at Creative Strategies.
“It’s like a toy that a spoiled child wants, but he doesn’t really know what to do with it, so he gets bored and doesn’t give it the attention it deserves, and he forgets it in a corner (…) Twitter would die slowly and painfully”, predicts Milanesi.
For Twitter “It’s going to be a battle on all fronts, retaining employees, keeping an eye on the competition coming after your business, brand issues, getting investors to believe the numbers,” says Ives, an analyst at Wedbush. All this while user growth on the platform slows and they deal with a slowing economy.
With information from AFP