Explainer: What happens next in the Elon Musk-Twitter saga? – times of India

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Even if Musk loses the court case against Twitter, some observers wonder whether the world’s richest man will follow the results.

San Francisco: Tesla CEO Elon musk And Twitter The billionaire said on Friday he was up for a legal battle after he was abandoning his $44 billion bid for the social media company.
Twitter is vowing to challenge Musk in court to keep the agreement. Shares of Twitter fell more than 11 percent on Monday. Here’s a look at what could happen next.
Why is Musk holding back?
There are many reasons why Musk might have second thoughts. But he alleged on Friday that Twitter had failed to provide enough information about the number of his fake accounts.
Twitter said last month that it was providing Musk a “firehose” of public raw data on millions of daily tweets. But Musk’s lawyers have argued that the company was providing Musk with sometimes “incomplete or unhelpful information” and less data than some of its larger customers.
Twitter said last week it uses a mix of public and private data to determine the amount of spam. Private user data is not publicly available and thus is not in the “firehose” of the data it provided to Musk. That would include IP addresses, phone numbers and locations. Twitter said such private data helps avoid misidentifying genuine accounts as spam.
Twitter has said in regulatory filings over the years that it believes about 5% of accounts on the platform are bogus. But on Monday, Musk continued to taunt the company, using Twitter for what he described as a lack of data.
What is Twitter’s response?
Twitter announced its intention to sue Musk. The company could have pushed for the $1 billion breakup fee that Musk agreed to pay under these circumstances. Instead, it appears ready to fight to complete the purchase, which has been approved by the company’s board and the CEO. Parag Agarwal Has insisted that he wants to terminate.
Twitter’s chairman of the board, Brett Taylor, tweeted on Friday that the board is committed to closing the transaction with Musk at an “agreed price and terms” and “plans to pursue legal action to implement the merger agreement.” is making. We believe we will win. In Delaware Court of Chancery.”
Trial courts in Delaware often handle business disputes between several corporations, including Twitter, which are incorporated there.
Who’s going to win?
It is almost impossible to predict the outcome of any protracted legal battle. But law and business experts agree that Twitter is likely to have a stronger case.
Morningstar analyst Ali Mograbi noted that Twitter has described its estimate of fake and spam accounts for years in regulatory filings, while explicitly noting that the numbers are not accurate given the use of data samples and interpretation. Might be possible.
Given current market conditions, Mograbi said, Twitter may also have a convincing argument that the layoffs and firings of the past weeks represent “a normal course of business.”
“Many technology firms have begun to control costs by reducing the workforce and/or delaying adding employees,” he said. “The resignations of Twitter employees certainly cannot be attributed to any changes in the operations of Twitter after Musk’s proposal was accepted by the board and shareholders.”
The matter may end in an agreement, for example, with both parties negotiating a lower price. If Musk wins, there’s also the question of a $1 billion breakup fee. He can certainly afford it, but would he want to pay?
What will happen to Twitter now?
The Musk saga, to put it mildly, has been a distraction for Twitter activists, executives and even users. Some employees have quit, while others have been fired or fired. Job offers have been scrapped and discretionary spending has been cut.
“This fiasco is a nightmare for Twitter,” Dan Ives, the Wedbush analyst who follows the company, wrote Monday. He said the result would be “an Everest-like climb for Parag & Co.” Given concerns over employee morale and retention, advertiser concerns and other challenges.”
Whether it changes hands or not, Twitter itself is unlikely to go anywhere. But if the turmoil continues, it could scare away advertisers. If too many engineers and other workers leave, the quality of the platform may also be affected.
CFRA analyst Angelo Zino said, “One bright spot is that if (Twitter) ultimately emerges victorious in the courts, it could potentially take north of the $1 billion in break-up fees that Musk has to pay.” Might have.”
If he loses, will Musk follow through?
Even if Musk loses the court case, some observers wonder whether the world’s richest man will follow suit. This is based on Musk’s tweets on his opposing view of the US Securities and Exchange Commission’s adverse actions, which claimed he had the money to take Tesla private in 2018.
This led to a securities fraud settlement with the SEC, which required that his tweets be approved by a Tesla attorney before being published. But the SEC later investigated whether the Tesla CEO had violated the agreement last November with a tweet asking Twitter followers whether he should sell 10% of his Tesla stock.
Musk had argued that the agency could not act on his tweets without the court’s permission. This time, though, he could face an actual court order to pay the $1 billion breakup fee — or to end the acquisition even if he doesn’t want to.

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