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0 pointsthaumasiotes4y ago0 comments

> digging deeper, the "people in the know" are now pointing out that this $1 Billion escape clause is actually very restrictive and unlikely to be invoked. Musk might be forced into buying Twitter at the previously negotiated $54.20 price.

Matt Levine had a pretty different take, pointing out that if Elon Musk suddenly appears to be unwilling to buy Twitter, his financing might see that and - suddenly, but perfectly legitimately - evaporate, which would be a valid reason for Musk to walk away.

It really is true that lending someone a lot of money to make an investment they aren't interested in is a much worse financial move than lending the same money to the same person to make an investment they are interested in.

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3 comments · 3 top-level

HWR_144y ago

I mean, if that's true it just goes one step back. Then his action breaking the contract would be to express equivalence or hostility towards the transaction.

thedufer4y ago

> Matt Levine had a pretty different take, pointing out that if Elon Musk suddenly appears to be unwilling to buy Twitter, his financing might see that and - suddenly, but perfectly legitimately - evaporate, which would be a valid reason for Musk to walk away.

That was awhile ago. Since then, the funding agreements have been made public, and Matt's most recent take is that the funding basically can't disappear unless Musk can kill the deal via another route.

danielmarkbruce4y ago

There is a best efforts covenant. They are in every merger agreement. Musk can't do this without being sued.

Look at Section 6.3

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