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When Elon Musk first went back on his deal with Twitter to buy the company, I stated that Elon Musk would have a tough time in court if Twitter tried to force him to buy them. Twitter basically was in a position where it held all the cards. They had a signed contract from Musk stating he would buy them. They also had the fact that Elon waved his right to do due diligence on the company. Then, when they did pursue legal matters, they were able to get a fast scheduled court date that benefitted them as well. I personally did not see anyway they could possible lose in court.
It seems like Elon Musk agrees because he will once again be buying Twitter at the agreed upon 44 billion dollar valuation. While 44 billion dollars seemed like a pretty ok price for Twitter when he first announced he wanted to buy it, the stock had fallen by quite a bit after he tried to back out of the purchase. On September 1st, 2022, Twitter had a market cap of 29.34 billion dollars. Now, after the news that Elon Musk is back in on the Twitter deal, Twitter is back to a market cap of around 38 billion dollars.
One thing that has yet to be seen is if Twitter is going to drop their lawsuit on Elon Musk. I don't think that they should just yet. I think they should keep their court date set until they know for sure that Elon is not going to just back out again once the suit is dropped. The court the trial is going to be held at is a big advantage for Twitter, and it is important for them not to give up that advantage until they know for sure.
I'm not surprised that Elon is back in on the Twitter deal. I couldn't see Twitter losing their lawsuit. It seemed like he was going to try and prove fraud on Twitter's part, but it does not seem like he was able to do this. His whole argument was that Twitter had more bots on the platform than they disclosed. It's worth mentioning here that he gave up his right to do due diligence on the company, but he was stating that while Twitter claimed 5% of its users were bots, he thought it was closer to 20%. He had 5 tests ran to try to prove his claim. One test also arrived at 5% for total number of bots. One test showed closer to 10%, and the other three have yet to reveal their findings. I imagine that their findings were not good if Elon is now wanting to buy Twitter again.
It'll be interesting to see what happens now.
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