Elon Musk Twitter deal termination ‘disaster scenario’ that could torpedo shares
What you need to know
-Elon Musk is trying to withdraw from his deal to buy Twitter. – An analyst says the revelation is a disaster scenario for the company. – Dan Ives believes this could reduce the price of his shares by a third and see employees knocking on the door.
According to one analyst, the shocking revelation that Elon Musk is trying to get out of his deal to buy Twitter is a “disaster scenario” for the company that could see its share price fall and could lead to a massive exodus of employees.
Following Friday’s revelation that Elon Musk wants to terminate his Twitter deal, analyst Dan Ives says Twitter could have big problems.
“This is a disaster scenario for Twitter and its board, as the company will now fight Musk in a lengthy legal battle to regain the deal,” said Dan Ives of Wedbush. Ives believes Twitter shares independently could now fall as much as a third to $ 25 when markets open on Monday. In fact, the stock price has already fallen by 4.8%.
Ives says the $ 44 billion price tag set by Musk “was always a head scraper” and didn’t make much sense to Wall Street.
Ives told Business Insider the news was “code red” for the company and warned that employees “could leave en masse,” with a more detailed scrutiny of the company’s metrics possibly leaving it “in sight.” as damaged property “. Musk’s main objection to closing the deal is Twitter figures on spam and fake accounts on his platform. While he says Twitter hasn’t given him enough information to have a clear picture, he says what he has found leads him to believe that there are many more robots and fake accounts than Twitter would like us to believe, greatly reducing the value of advertising. to the platform and the company as a whole.
The Twitter board has pledged to close the transaction at the agreed price and terms and has confirmed it plans to fight Musk’s withdrawal from the courts.