Elon Musk highlights that several challenges remain, including unresolved issues around user activity on the social network, the number of fake accounts, and concerns tied to debt and shareholder consent for the proposed deal. These points underscore the ongoing scrutiny surrounding the potential Twitter acquisition and its financial and governance implications. [Bloomberg]
There is a question about whether the debt portion of the funding round will come together and whether shareholders will vote in favor. In an interview conducted during the Qatar Economic Forum, Musk described his intention to focus on enhancing the product on Twitter if the acquisition proceeds, while noting that this does not automatically imply taking on the role of chief executive. [Bloomberg]
In mid May, the entrepreneur decided to temporarily pause the deal. A transaction valued at 44 billion dollars was initially agreed upon at the end of April, with details awaiting confirmation that fake or spam accounts account for less than five percent of users. [Bloomberg]
Then, in a letter sent by Musk’s legal team to the U.S. Securities and Exchange Commission in early June, the billionaire’s representatives assessed Twitter’s position and argued there could be a material breach of obligations under the merger agreement. They warned that Musk reserves all rights, including the option not to complete the transaction and the right to terminate the merger agreement. [Bloomberg]
Possible recession in the USA
On the other hand, the world’s richest individual suggested that a downturn in the United States appears more likely than not in the near term due to the Federal Reserve’s aggressive moves to curb inflation. The perspective underscores the broader macroeconomic risk environment surrounding the deal and the potential impact on technology firms and capital markets. [Bloomberg]
He stated that a recession is probable at some point, with the likelihood higher in the short term. While he acknowledged it is not certain, he characterized the probability as significant, reflecting expectations of tighter financial conditions and slower growth ahead. [Bloomberg]