Elon Musk is Paying Too Much for Twitter
Will Twitter's Board Agree to a More Reasonable Price?
Last week I was approached to participate in a Special Purpose Vehicle “SPV” to invest with Elon Musk to take Twitter private. The deal was straightforward:
Min Investment: $250K
Fees: $18K (SPV formation)
With just 24 hours to express interest, I couldn’t help but think the valuation no longer made any sense. If the valuation didn’t work for me it certainly didn’t work for Elon, with Tesla falling more than 25% in the last month. It occurred to me that Elon really needed to find a way to renegotiate the price.
Early this morning Elon Musk tweeted that he was putting his acquisition of Twitter on hold citing concerns over fake accounts. I was disappointed and yet unsurprised given market conditions.
Then a few hours later the billionaire reiterated his commitment to completing the acquisition.
Of course, Elon would owe $1 billion if he backed out of the deal so he is pretty much required to claim that he’s committed to the deal. I hope that he still wants to do the deal despite the massive correction in the market but I can’t help but think he’s really having second thoughts.