Could Twitter Force Musk to Close the Deal? Here’s What We Know

admin July 11, 2022

0 6 minutes read

Head to court

Elon Musk finally chased his threat last week and tried to withdraw from his $ 44 billion deal to buy Twitter. The social media company quickly responded that it was planning to file a proceeding. Most legal experts believe that the law is strong on Twitter’s side, given that explosives are not revealed during the trial. (Musk, tweeted earlier this morning, Seems to enjoy the outlook Forcing Twitter executives to hand over information about how the company accounts for bots to court, his main complaint. )

But that doesn’t mean you get what you want. Twitter’s share fell by about 5% in pre-market transactions.

The deal with Twitter and Musk said it could force him to close the deal. Twitter has a specific performance right in its contract with Musk. This allows a company to file a proceeding to force the transaction to be completed. Given regulatory approval, one is that Mask’s debt lending needs to be provided.Morgan Stanley and other lenders have already committed $ 13 billion In debt.

The court had other companies follow through the acquisition.

In 2001, the judge ruled that poultry giant Tyson had to complete a $ 3.2 billion deal to buy IBP, the country’s largest beef processor at the time. Mr Tyson said he was unaware of the IBP’s accounting problems. However, the IBP said Tyson was only “remorse for the buyer.”
Recently, Kohlberg & Co, a private equity company. Attempted to kill a $ 550 million acquisition DecoPac claims that the pandemic caused a “significant negative impact” on the transaction. Nevertheless, a Delaware court ordered Kohlberg to complete the transaction.
Still, judges are ordering damages more often than having companies and individuals buy companies that they no longer need.

But the Twitter-Mask feud would be complicated for courts to oversee. A The $ 44 billion transaction diminishes past proceedings resulting in specific performance clauses. And unlike Tyson’s deal, Musk relies on external funds to fund his purchases. Bank pledges will need to be enforced by New York courts. Banks are not keen to lend billions of dollars to transactions where buyers no longer want the company. Will they ask the New York judge to get out of it? Does the judge forgive them? Will it take musk off-hook, as certain performances only apply if there is a debt loan? (The failure of the merger of chemical companies Huntsman and Hexion in 2008 is one of the most famous examples of companies dueling for specific performance, and banks have withdrawn. However, I had to pay the settlement money.).

And what if the mask simply doesn’t do what it says? A Delaware courts are most likely eager to force Masks to comply with the text of the law. But his reputation for exaggerated practices may also suspend it. “The worst scenario for the court is that it gives orders and he doesn’t obey, and they have to understand what to do about it,” said Professor Morgan Ricks of Vanderbilt Law School. Told the Deal Book. Musk is the CEO of a public company. What does such a blatant rebellion against corporate law mean for investors like Vanguard?

If a particular performance is off the table, then what? According to most readings of the contract, the amount of damages for the transaction is limited to $ 1 billion. But if he was forced to buy a company thinking he might lose, he could offer him a $ 5 billion fee to leave Twitter, for example. Twitter can also negotiate prices and hope to follow through if masks can be cheaper.But with Twitter hiring a legal powerhouse Wachtell Lipton, The company seems to be ready to go to court after negotiations.

What’s happening

Steve Bannon agrees to testify to the Commission on January 6th. Banon, a former Trump campaign manager and White House adviser who was put on criminal trial for parliamentary insult, suddenly frowned after the former president allowed him to talk to investigators.

Shinzo Abe’s party wipes out for victory in Japan’s parliamentary elections. Yesterday’s results, two days after the assassination of former Prime Minister Abe, meant that the LDP and its coalition had enough seats to occupy a two-thirds majority. New leaders are likely to pursue Prime Minister Abe’s long-standing ambition to amend Japan’s pacifist constitution.

Pilots are demanding significant increases and improved quality of life. Recently, two of the major airlines have proposed raising pilot wages by more than 14% next year and a half. The union is also demanding broader changes than they say will improve operations and working conditions, especially as pilots feel frustrated and overworked due to flight disruptions.

Sri Lanka faces a vacuum of power as its leaders disappear. After tens of thousands of protesters attacked the president’s house and office, as well as the prime minister’s house over the weekend, Gotabaya Rajapaksa and Ranil Wickremesinghe remained hidden.

The FDA gets the first application for over-the-counter oral contraceptives. HRAPharma, a Paris-based company, will seek FDA approval for pills immediately for over-the-counter sales in the United States. Most drug applications are overlooked in Washington, but formal HRA applications are especially difficult. Moment of campaign for reproductive rights.

Florida targets DEI training

New Florida legislation, which could limit employers’ ability to require diversity, equity, and inclusion (DEI) training, is the latest flash point for companies looking to address hot button legislation in an increasingly polarized country. I am threatening to become.

The “Stop WOKE Act,” which was enacted by Governor Ron DeSantis in April, came into effect on July 1. Historical events by their race, gender or country of origin.

Republican-controlled Florida parliament approved bill in March.. Its focus is on critical race theory, the notion that historical patterns of racism are rooted in society, which has become a punching bag for conservative politicians.Efforts to limit such teachings at school Spread over the red states..

The company was against the bill. “Represented alarmIn the February letter “was the Chamber of Commerce of H & M US, Levis, and Greater Miami. “There are legal and ethical requirements to create a safe and equitable workplace by providing meaningful training on workplace issues such as sexual harassment, diversity and inclusion,” an H & M spokeswoman told DealBook. rice field. Other signers contacted by DealBook will not comment. Perhaps with DeSantis’ retaliation against Disney against the state’s so-called “Don’t Say Gay” teaching method.

There may be workarounds in the new Florida law. The law does not apply to voluntary programs. And despite the law’s focus on programs that can cause guilt, it’s not the way most workplace training programs work, and previously led the Global Diversity and Inclusion Program at Morgan Stanley. Attorney Jeffrey Siminoff said. “Therefore, it’s quite possible that most programs don’t even violate what Florida is trying to ban,” he said.

Can Florida companies comply with the law and pursue diversity? “I think organizations that are committed to inclusion and diversity and are trying to visibly support it will have to stop for a moment to understand their footsteps in Florida,” said Siminoff.

“Sometimes I can afford something like beer, but I don’t really want anything. It’s an unpleasant position. It’s not the life I wanted.”

— 40-year-old Christian Drake, who works in retail, has a career in the number of millennials. Behind the economic and family progress of previous generations..

UK Storm Tax Details

As Britain gets caught up in the political crisis and the Boris Johnson administration collapses, oil industry executives change to a controversial storm tax bill aimed at curbing the surge in profits of oil and gas companies. I’m asking the government to add it.

The bill was announced as a way to raise around £ 15 billion, or $ 17.9 billion, to help low-income households with rapidly rising energy prices. Member of Parliament Scheduled Discuss today’s bill.

Oil and gas companies say imposing a 25% tax on profits could discourage future investments during times of crisis for Britain, which is facing rising energy prices. “Many of the financial institutions that lend money to our industry see governments sending very complex signals,” said Mike Tholen, Sustainability Director of the industry group Offshore Energies UK. .. Toren, who is seeking a meeting with the new Prime Minister of Finance Minister Nadim Zahawi to discuss possible changes, said the tax would do nothing to lower gas prices.

Some scholars say the warning from the oil industry is exaggerated. Arun Advani, a researcher at the Institute for Fiscal Studies, told DealBook that some companies’ discussions about tax cuts on their ability to invest in future renewable energy sources are unexpected for these additional benefits. He said he couldn’t hold up because it was.

A storm tax plan comes as the oil company reports record profits. Shell said he expects refining profits to nearly triple and add $ 1 billion to earnings as petroleum product prices soar due to lack of refining capacity. BP reported the largest quarterly profit in 10 years. In the United States Democratic groups are urging President Biden to enact similar policiesBut it will face big hurdles in Congress.