Twitter Inc (NYSE:TWTR) stock fell on Monday after Tesla Inc (NASDAQ:TSLA) CEO Elon Musk threatened to terminate his $44bn takeover of the company over what he claimed was a “clear material breach” of the merger agreement.
As Elon Musk threatens to walk away from the Twitter deal, sending Twitter stock tumbling, investors wonder what’s next for the social media app? And what does this all mean for Twitter and Tesla shareholders?
Elon's Threat To Terminate Deal Sent Twitter Stock Tumbling - What's Next?
Scott Sheridan, market expert, and CEO of tastyworks comments:
"I never believed Elon was serious about this acquisition to begin but Twitter called his bluff. I thought and continue to think he’s just a bully on a unique level. Whether or not this is a legitimate legal reason to end the deal is something the lawyers will need to sort out. But I think Elon’s been looking for an out ever since Twitter agreed to accept his bid of $54.20/share.
Usually, breakup fees are pretty tough to get out from, but that doesn’t mean it’s impossible or Elon won’t try.
I think for Twitter though, there’s probably a sigh of relief with respect to Elon personally not owning the company.
For shareholders, I’m not sure this deal falling apart is a bad thing. I think the stock is probably in play now and may have other potential suitors. There is also the opportunity Twitter makes changes that ultimately unlock shareholder value."
What Does This Mean For Tesla?
"As for Tesla shareholders, I think the deal not going through is a good thing. This leaves Elon focused on current endeavors and removes any risk of him getting distracted by, what would be, a major investment".
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