It turns out “billionaire made a whoopsie” isn’t a legally valid reason to back out of a merger — but he's tweeting through it nonetheless.
Elon Musk is bored. The man with the most money in the world, who decided a few months ago to purchase Twitter on a total lark, has decided that actually, he’d rather not. On Friday, Musk and his team of extremely expensive lawyers, who are paid to sit around and try to bend the law to suit his whims, filed paperwork to try to back out of legally binding agreement to buy Twitter. Then, over the weekend, he tweeted through it — because, of course he did.
A real quick recap of how we got here: Musk, shitposter extraordinaire, took a joke too far and agreed to purchase Twitter and take it private for $44 billion. He reached that figure not through the usual intensive due diligence that Serious Business People undertake before making a large purchase, but by offering $54.20 per share because that figure has the weed number in it. Then the market crashed, and Musk’s offer — which already put Twitter’s value at a significant premium — started to look like a massive overpay. So, he began trying to lie his way out of it. Musk claimed that Twitter lied about the number of bots on its platform and, as such, he wants out of the deal.
Musk’s latest filing with the Securities and Exchange Commission seeks to “terminate” the Twitter purchase agreement. The official, on-paper reason: Twitter has refused to give Musk data regarding bots on its platform. The real reason: He’s bored, he made a bad deal, and he’s trying to wriggle his way out of it while footing the smallest bill possible.
It’s important to note that Musk can’t, despite his best efforts, just “terminate” the agreement. That’s not how these things work. Musk signed a merger agreement that’s legally binding, save for a few scenarios — none of which are “billionaire made a whoopsie.” It’s all fun and games until you put your name on the dotted line of those huge stacks of papers that your lawyers drew up. Then, all of a sudden, you’re expected to be held accountable for what you said you’d do. Pretty wild stuff!
So, does Musk actually have a way out of this? Maybe. He might be able to get out of the deal if he can prove that Twitter both falsely represented the number of bots on its platform and that the information would have a “material adverse effect” on Twitter’s valuation.
But it’s pretty impossible to believe that Musk actually thinks that’s the case. He’s explicitly referenced bots on Twitter in the past, even saying that his reason for wanting to buy the platform was to get rid of them. Days after agreeing to buy Twitter, he tweeted, “If our Twitter bid succeeds, we will defeat the spam bots or die trying!” Pretending that the bots are suddenly some sort of unforeseen problem is laughable — but in the “are you kidding me?” kind of way, not the “ha ha” kind of way.
Which brings us to how Musk is handling the fallout of his decision to reverse course: He’s shitposting through it. At this point, we’re basically guaranteed to see Musk’s poorly cropped and uncredited memes come up as evidence during the court case that will determine if he’ll actually have to follow through on his Twitter bid.
Twitter, for its part, has simply stated that it will seek to enforce the merger agreement. If Musk can’t prove his claims about the bot situation — an uphill battle, for sure — the Delaware Court of Chancery could force him to buy the company at the agreed-upon price, or to negotiate a new deal or buyout.
Either way, it’s hard to imagine Musk not at least forfeiting some of his wealth — either in the form of a multi-billion dollar breakup fee or a $44 billion purchase that’s already produced the world’s biggest case of buyer’s remorse on record. So let’s all spare a thought for the real victims here: His nine kids who are watching him spend down their inheritance on Spencer’s Gifts-quality gag purchases.