Twitter Board Again Urges Shareholders To Accept Elon Musk Acquisition, But Tesla Chief Warns Of “Unresolved” Issues

Twitter’s board of directors reiterated its request to shareholders to approve a $ 44 billion acquisition proposal led by Elon Musk, but Tesla’s billionaire chief executive warned of three “unresolved” issues hindering the transaction.

In a statement to the SEC, Twitter CEO Parag Agrawal and Chairman Brett Taylor asked shareholders to vote in favor of the deal at an upcoming special meeting. They noted that shareholders will receive $ 54.20 per share of the Twitter stock they own. The stock was up nearly 3% in early trading to around $ 38.76 since the filing news began. It has lost more than 20% of its value since the merger plan was announced in April, although most tech stocks have seen a similar decline due to deteriorating economic conditions.

Meanwhile, Musk offered an obviously dark perspective on the economy when he addressed the Qatar Economic Forum in Doha. He said a recession was “inevitable at some point” and added that an impending recession was “more likely than not”.

As for Twitter’s acquisition status, backed by more than a dozen other investors, Musk gave the green light to indicate that his previous concerns about the number of fake “bot” accounts had not gone away. “There is a limit to what I can say in public,” he said. “This is a somewhat sensitive subject.”

Musk would have to pay $ 1 billion in tax if he decides to renounce the Twitter deal, but he has already advised Twitter to do so. In a statement to the SEC this morning, Twitter warned shareholders that if the deal doesn’t materialize, “the price of our common stock could drop significantly.”

Twitter claimed to account for less than 5% of its account base, but Musk denied the claim. “This is probably not the experience of most consumers,” she said at an event in Qatar that he attended virtually.

With the launch of the bot and the outcome of the shareholder vote, the third hurdle to resolve in the transaction is part of the debt of the transaction, Musk told moderator John Mickeltweit, editor-in-chief of Bloomberg News.

The current structure of the Twitter deal will pay Musk $ 33.5 billion in cash to the company, while other investors will pledge an additional $ 7.1 billion. The balance of the loan will come through a series of unfinished bank loans.

In addition to the financial aspects of the Twitter deal, Musk raised questions about what position he would take on the nature of the content that would be allowed on the platform. “My ambition for Twitter, or Digital City Square in general, will be to be as inclusive as possible in the broadest sense of the word,” she said. “This is an interesting system to use.” Ultimately, he said, the goal would be to get “80% of North America and half of the world” using Twitter, a steep increase from the current level of 229 million daily active users.

Expanding to a wider audience requires Twitter to avoid a “place to go.” [people] “You feel uncomfortable or burdened,” Musk continued. “There is a big difference between freedom of expression and freedom of access, because in the United States you can go to the middle of Times Square and almost shout whatever you want. You will irritate those around you, but you have the right to scream as much or as little as you want in a crowded public place, except “it’s a robbery”.

Twitter users, using the social media mask concept, expressed their preferences about what types of posts they would see on their channel and the “offensive” ones would be excluded for those who refused to see them. He did not formulate any plans as to how the material would be considered offensive. Twitter, like Facebook and other widely used technology platforms, had problems with content moderation. In 2020 he introduced a system to tag tweets, but was generally reluctant to remove it from any user platform. In January 2021, following the attack on the United States Capitol, Twitter banned former President Donald Trump and others from commenting on his posts, saying they were promoting violence. Musk strongly suggested that Trump and others could return if he could complete the deal.

Mickeltweit asked Musk if he would support Trump in the 2024 presidential election. “At this point, I’m decisive in that election,” Musk said. Last week, the chief executive said he will seriously consider Ron Desantis, the Republican governor of Florida whose policy decisions are in line with Trump’s decisions.