One thing investors are not interested in is the long-running legal battles, even in hip companies such as Tesla, SpaceX, Neuralink and The Boring Company.
Read More:
Is Cash Trash This Should Be Your Cash Allocation in a Bear Market
Stock
Cash serves an important purpose in many investment portfolios, but as the stock market fluctuates, many investors turn to investment to avoid losses. However, depending on the reason, moving all your investments from stocks to stocks can be a huge mistake. Even during the bear market, holding a heavy portfolio can cost you more money than you realize. Instead, consider spending money and allocate only a portion of your money to this category of assets. A financial advi...
Avoid UiPath Stock Until It Gets Back on the Right Trail
Stock
Nasdaq bear market disrupts UiPath stock performance In hindsight, UiPath's (NYSE: PATH) business sounds like a new distraction. Robotic process automation, or RPA, handles repetitive tasks that can make digital transformation real. But the UiPath stock does not buy well here. But what about it? Why has PATH stock dec...
The world watched another ping pong business news on May 13, with Tesla billionaire Elon Musk claiming he was terminating his contract to buy Twitter and hours later said he was still determined to merge.
There was still one chapter in a heated series of conversations about the end of the microblogging platform.
In many ways Musk's deal to buy Twitter (TWTR) - for $ 44 billion quickly turns into a red-headed adopted child.
It has now become an albatross thing for both investors and the market already worried about the stubborn inflation and possible recession on the horizon.
Throw in the ongoing crypto collapse and you have an agreement demanded by a few people - not these Twitter shareholders, or these Tesla shareholders, or Twitter employees, and increasingly, even Musk himself.
So What Is Holdup?
Musk's excuse for the latest delay is a Twitter post showing that about 5% of its bots are users.
That is an annoying feature of the site that angered Musk and even called it one of his main reasons for seeking the site in the first place.
However, he now said he would suspend the talks until further investigation into the number.
Only problem?
The fact that a percentage of the bot has already been published by Twitter and known in the market through its quarterly reports since 2013.
While Musk may be using the bots issue as a way to negotiate lower retail prices - both Twitter and Tesla have cut key hairs since the $ 54.20 deal per annum was announced on April 14 - he may also be getting it. how to leave the agreement altogether.
If so, his contract with Twitter says Musk will have to pay an estimated $ 1 billion.
But the actual cost of breaking the agreement can be much higher.
Twitter Divorce May Cost Billions In Legal Payments
Twitter has been talking about its dangers in engaging with Musk.
A recent document submitted by Twitter and the Securities and Exchange Commission shows that the company is already pricing in a possible legal battle with Musk if the merger contract is violated.
The 10-Q, which you can read all about here, is included for the quarter-term ending March 31.
Twitter also warned of possible charges related to meeting Musk, saying that if the agreement is not finalized it may follow legal action.
The allegations could cost Musk huge sums of money and could also affect Twitter shareholders, the form warns.
"Regardless of the outcome of any future merger, such litigation may be time-consuming and costly and may interfere with our management's ability to carry out our day-to-day business," the company said.
"The costs of the trial and the diversion of management's attention and resources to deal with litigation and litigation in any claims related to consolidation may adversely affect our business, operating results, opportunities, cash flows, and financial position."
Meanwhile, Twitter is still a mother about Musk's feelings of being beaten on May 13.
But that does not mean that he does not know the risks involved in a long-running lawsuit if the agreement fails.
"Any consolidation-related lawsuit could result in a negative publicity or negative opinion of us, which could have a negative impact on the value of our common stock," Twitter said in its 10-Q statement.
"[It] may impair our ability to hire or retain employees, damage our relationships with our advertisers and other business partners, or seriously damage our performance and financial performance," the file said.
How Expensive Is It?
The recent cataloging of some of America's biggest consolidation disasters by DealRoom puts the cost of major corporate divisions into billions.
It is listed as one of the top eight failures, all costing billions of dollars to complete.
Each spent many years in court, as the aggrieved parties distributed a high amount of appeal - and details from time to time - to investors and the public alike.
The study included those costs as follows:
American and National Bank (2008): $ 2 billion
EBay and Skype (2005): $ 2.6 billion
Mattel and Learning Company (1998): $ 3.8 billion
Microsoft and Nokia (2013): $ 7 billion
KMart and Sears (2005): $ 11 billion
Google and Motorola (2012): $ 12.5 billion
Daimler-Benz and Chrysler (1998): $ 36 billion
America Online and Time Warner (2001): $ 65 billion
While Musk’s plan to buy Twitter focuses on the biggest purchases in history, it carries a similar risk.
The deal could turn into something similar to the situation where LVMH (LVMH) left to buy Tiffany & Co. jewelry. (TIF) - It will also be claimed back in compilation by the latter.
They ended up agreeing on a lower price and ended the agreement.
Although the above deals were often between the two companies, Musk's status as the richest man in the world could only be affected as long as his stock in his companies was always trading at high levels, making him financially unstable and unstable.
But one thing investors don't like is the long-running legal battles - even in hip companies such as Tesla (TSLA) - SpaceX, Neuralink and The Boring Company, law enforcement agencies and court dates may be enough to intimidate even Musk very strong. follower.
Read More
Courtesy Grizler.com
