New York (CNN Business)First, Elon Musk wanted to buy Twitter, but it wasn’t clear if the company would be on board. Then the two sides agreed to a stunning, $44 billion deal. Now, Musk wants out of the agreement and Twitter is suing to stop him.
Less than three months after Musk and Twitter agreed to the billion acquisition, the two parties appear bound for a courtroom to determine the fate of the deal. No matter the outcome of the case, one thing seems certain: Twitter will have to continue confronting a painful amount of uncertainty for its business and employees from the ongoing Musk drama.
Musk moved to terminate the acquisition agreement last week, alleging that Twitter (TWTR) breached the deal by failing to hand over data he says he needs to evaluate the number of bots and spam accounts on the platform. This week, Twitter hit back with a 60-plus-page lawsuit that accuses Musk, not the company, of violating the agreement and seeks to compel him to follow through with the deal.
Many merger and acquisition experts agree that Twitter has the stronger legal argument. Twitter claims in its suit that with financing commitments for the deal still intact, no apparent issues with regulatory approval and cooperation by the company itself, Musk has no standing to walk away from the agreement.
But a possible stronger legal argument doesn’t necessarily mean Twitter is on strong footing in other ways. Twitter was already struggling to grow its advertising business and user base before Musk got involved. Like other tech companies, Twitter is also trying to cut down on costs amid rampant inflation and fears of a recession.
With the suit, the company is primed to enter a legal battle with the richest man in the world that risks dragging on for months. (Twitter filed a motion for expedited treatment of the case, requesting a four-day trial in September.) If it prevails, Twitter could effectively force a billionaire who, according to its own complaint, has repeatedly disparaged “Twitter and its personnel” to become its new owner.
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It’s a strange conundrum for the company — especially after its users and employees have expressed concerns about Musk as an owner — but since the deal price of $54.20 per share represents a huge premium over Twitter’s current stock price, Twitter’s board has a duty to shareholders to try to see the deal through, or at least to get as much money out of Musk as possible. And the only way a court will side in its favor is if Twitter shows it is making a good faith effort to complete the agreement.
Alternatively, Twitter could negotiate a lower price for the deal or a settlement that allows Musk to walk away — and hope that its shareholders don’t disapprove. Or Musk could win and walk away, leaving Twitter with nothing, or worse. Deal or no deal, Musk remains one of Twitter’s largest shareholders, but that too could change if he chooses to wash his hands of the company, with potential ripple effects for the company’s other shareholders.
In the meantime, the company is left with distracted leadership and demoralized employees as well as users, advertisers and shareholders unclear about the platform’s future.
“It’s hard to imagine how the company is going to get itself together and go forward” regardless of how the suit resolves, said Carl Tobias, a professor at the University of Richmond School of Law. “It may just not have a very happy resolution, unfortunately.”
Twitter declined to comment for this story. Musk has not commented directly on the lawsuit, but shortly after it was filed, he tweeted “Oh the irony lol.”
Bracing for a ‘messy’ legal battle
In his letter seeking to terminate the deal, Musk’s legal team hinted at his likely arguments in the case. In addition to his claims that Twitter has not upheld its obligations to share information, the letter alleges (without providing evidence) that the company’s public statements that fake and spam accounts make up around 5% of its monetizable daily active users were false or misleading.
“What he seems to be after here is an exit ticket to just get off the ride and walk away for nothing,” said Eric Talley, a corporate law professor at Columbia Law School. But, he added, those arguments may be difficult to stand up in court. “They all have a tinge of wishful thinking.”
In particular, Musk’s claim that he relied on misleading public statements by Twitter about bots when making the deal “flies in the face of his entire behavior leading up to the transaction,” Talley said. Twitter noted as much in its lawsuit, pointing to Musk’s public statements about wanting to purchase the company so that he could “defeat the spam bots.” Essentially, it’s hard for Musk to argue he didn’t know about Twitter’s bots when he explicitly said that was his reason for buying the company in the first place.
Twitter’s complaint also alleges that on April 9, the day Musk said he wanted to buy Twitter outright instead of joining its board, Musk texted Twitter board chair Bret Taylor. In his text, Musk allegedly said that “‘purging fake users’ from the platform had to be done in the context of a private company because he believed that it would ‘make the numbers look terrible.'”
Twitter’s lawsuit also pushes back on the idea that it has resisted sharing information with Musk. On top of handing over its “firehose” of data about tweets on the platform and “a detailed summary” of its process for measuring bots, Twitter representatives also held multiple meetings with Musk’s team and offered the opportunity for others, which Musk declined or ignored, the complaint alleges.
Legal experts note that the original acquisition agreement grants Twitter significant leeway to determine if information requests are “reasonable” and tied to the completion of the deal, and to deny them if they could harm the company competitively.
Musk also claims that Twitter violated an agreement to operate its business normally ahead of the merger by letting go of two executives and announcing lay-offs of a portion of its recruiting team. Twitter, however, noted in its complaint that while Musk had requested a provision requiring Twitter to seek his consent before making such changes to its workforce, “Twitter successfully struck that provision before signing” the agreement. Furthermore, Twitter alleges that it tried to introduce employee retention programs, but Musk prevented them from being enacted.
Musk will largely bear the burden of proving that he did not simply “wake up with a huge financial hangover” and that his claims are not a pretext to get out of the deal, according to Talley.
“It’s going to be a very messy litigation,” said Kenneth Henderson, a partner at law firm Bryan Cave Leighton Paisner.
‘How long can Twitter last?’
Ultimately, the court will examine whether or not there has been a breach of contract, either by Musk or Twitter. If it sides with Musk and finds that Twitter has breached the deal, it could allow the billionaire to walk away, and potentially sue the company for damages, experts say.
But if the court sides with Twitter and finds that Musk’s attempts to exit amount to a violation of the deal, Twitter is entitled to ask the court, as it does in its suit, for specific performance, a remedy in which Musk would receive an injunction forcing him to close the deal. While specific performance clauses are often included in large corporate acquisition contracts, they don’t often need to be executed, meaning the court will have limited precedent to rely on in evaluating the case between Twitter and Musk, according to Henderson.
There is some public debate as to whether the Delaware Chancery Court, where the case was filed, will be willing to grant specific performance in this case, given Musk’s unpredictable nature and the possibility he might not comply with the decision. “The courts in Delaware, courts all over, are very concerned about issuing a decision or issuing an order that then is ignored … it reflects poorly on the court,” Carolyn Berger, former vice chancellor of the Delware Chancery Court, told CNBC on Wednesday.
Still, Talley said he doesn’t think the court would shy away from ordering such a remedy, if it finds that Musk’s attempt to walk away violates the deal. “The court has not generally blinked in cases where you’ve signed up for a deal and you get buyer’s remorse and you try to walk away, the one stock and trade that we have as a judicial system is our willingness to enforce contracts so we’re going to do that,” Talley said.
4 Important Tips for Having a Vacation Abroad
Are you planning to go abroad but still don’t know what to prepare? People dream of going abroad, especially to countries like America and Europe. If this is your first time going abroad, you should check the following tips!
Prepare All Important Documents
The first thing you need to do is prepare important documents. For example, passports, ID cards, visas, and international driving licenses if you are going to drive abroad. Make sure you know whether the country you are going to visit is visa-free or not. For Southeast Asian countries, the Maldives and Turkey are visa-free, so you only have to have a passport. But a visa is still needed if you want to go to South Korea, Europe, or America. Make sure to scan your document and save it in the cloud like Google Drive or iCloud. Oh, yes, remember to check your vaccination status. Because every country needs your health information.
Itinerary is important for those who want to travel abroad. The reason is holidays abroad cost a lot of money, so when you can, take advantage of it with a well-planned schedule. Research in detail the tourist destinations you want to visit. For example, what is unique in it, ticket prices, transportation to get there, to the distance from the inn you’re staying. Remember to include places to eat that you want to try. Make sure the place to eat is according to your preferences, such as halal or free of certain food allergies.
Book Tickets in Advance
When you know how long you will be on vacation with the itinerary that has been prepared, it’s time to book plane tickets and lodging. Find cheap tickets by:
- Using promos and discounts on travel agent applications.
- Comparing which price is lower and what kind of facilities you will get.
- Choosing accommodation that fits your budget but is still comfortable.
Oh yes, also remember to check how the pandemic situation is in the country you are going to visit. Do you have to quarantine or not? Because it will affect your itinerary and accommodation. Due to the pandemic conditions that have not fully recovered, check whether there is still Indonesia quarantine after returning from vacation.
Exchange Money and Check Your ATM Cards
Exchange your currency into the destination country’s currency, for example, yen, euros, dollars, won, and others. But remember, don’t carry too much cash because it’s also prone to theft, besides being wasteful. For the rest, you can do cashless transactions. Check your bank’s ATM card to see if it has Visa, MasterCard, or Cirrus logos. This row of stamps indicates that your bank is working with banks abroad. Or you can also use a credit card to make your transaction easier.
Down 43%, Is This Tech Stock Worth Buying Right Now?
Skyworks Solutions (NASDAQ: SWKS) announced its fiscal 2022 fourth-quarter results (for the three months ended September 30) on November 3, and the supplier Apple’s stock price has risen 11% since then.
Skyworks beat expectations and showed solid growth at a time when smartphone sales were declining, but forecasts show the chipmaker is about to hit a bump. With that said, let’s take a closer look at the latest results from the chipmaker. Let’s take a closer look at whether the stock can sustain new momentum after losing 43% of its value in 2022.
Skyworks solutions deliver reliable results for non-mobile businesses
Skyworks’ fourth-quarter revenue increased 7% year-over-year to a record $1.4 billion. The company also reported non-GAAP (adjusted) earnings of $3.02 per share, up 15% year-over-year. Skyworks easily justified analyst estimates of $2.91 per share. For the year, the company’s revenue increased 7% to $5.5 billion and earnings rose similarly to $11.24 per share.
The strong growth of chipmakers in the fourth quarter was the result of successful diversification into new markets such as Internet of Things (IoT) and automotive, as well as relationships with major smartphone original equipment manufacturers (OEMs). Yes, it helped make up for it. Weakness in the smartphone market. space. However, it was the non-mobile business that put a lot of effort into Skyworks last quarter.
As CFO Chris Sennesael noted in the report, the company generated $500 million in revenue from broad market segments (counting chip sales for non-mobile applications like IoT), up 30% from the previous year. Last earnings conference call. Broad market companies contributed 36% of Skyworks’ revenue last quarter, up from 29% in the same period last year.
It’s also worth noting that Skyworks earned $2 billion in revenue from this segment for the entire fiscal year. That’s almost 43% more than the $1.4 billion in revenue last fiscal year. The good news is that the company’s business in a wide range of markets can maintain its momentum. This is because, as Skyworks showed in its earnings report, it is attracting new customers in high-growth niches like IoT.
“In IoT, we continue to win new customers and expand our content. We have partnered with Vodafone to launch the UK’s first WiFi 6E platform. We have launched a solution for Fi 6 hotspots.”
Skyworks also enables the deployment of O-RAN (Open Radio Access Network) and delivers record quarterly results in the high-growth automotive business niche. For example, the O-RAN market is expected to grow at an annual rate of 42% until 2030. Meanwhile, according to Mordor Intelligence, the demand for connected cars will grow by 19% per year until 2027.
These catalysts explain why Skyworks expects its broad commercial segment of the market “to be a major driver in FY23 and beyond.”
The mobile business was not in its best last quarter
Skyworks’ mobile business generated approximately $907 million in revenue last quarter (this is total revenue minus $500 million from the broader market business). By comparison, 71% of Skyworks’ $1.31 billion in revenue last year came from its mobile business, worth nearly $931 million.
Thus, the company’s mobile business, which generates most of its revenue, declined year-over-year in the most recent quarter. This is not surprising given that smartphone sales have been declining for the past five quarters. Skyworks considers Apple its biggest client, with the smartphone giant generating 58% of its revenue last year.
Last quarter, Apple shipped 48.5 million smartphones, 6.4% more than last year. However, the overall smartphone market was down 9% year-over-year. And now things could get even worse for Skyworks.
All of this explains why Skyworks management is targeting a sharp drop in sales and profits. The chipmaker expects revenue of $1.3 billion to $1.35 billion and adjusted earnings of $2.59 per share in the first quarter of fiscal 2023. These numbers show double-digit declines in both revenue and earnings compared to the last year.
Tech Shares May Weigh On Taiwan Stock Market
(RTTNews) – The Taiwanese stock market fell nearly 230 points (1.7%) on Tuesday after falling for two days. The Taiwan Stock Exchange is currently just above the 14,700 plateau, but selling pressure is likely to resume on Wednesday.
The global outlook for Asian markets is mixed, with little change ahead of major economic events that could affect the interest rate outlook. European and US markets were mixed and flat, followed by Asian equities.
The Tokyo Stock Exchange closed sharply higher on Tuesday after gains in financial, technology and cement stocks.
The index closed at 14,709.64, up 152.77 points (1.05%) after trading between 14,449.05 and 14,716.58.
Among assets, Cathay Financial was up 3.45%, Mega Financial was up 1.78%, CTBC Financial was up 2.93%, Fubon Financial was up 2.94%, First Financial was up 1.35%, E Sun Financial rose 1.66%, Taiwanese semiconductor company rose 1.35% and United Microelectronics rose 1.35%. Corporation and Catcher Technology rose 0.56%, Largan Precision shed 0.22%, MediaTek rose 1.42%, Delta Electronics rose 1.71%, Novatek Microelectronics rose 0.51%, China Steel rose 0.51%. 2.87%, Formosa Plastics shed 0.22%, Nan Ya Plastics rose 0.92%, Asia cement rose 1.48%, Taiwanese cement rose 1.67%, and Hon Hai Precision remained unchanged.
Wall Street’s lead indicates a slight negative bias as the leading average rose, then fell in the middle of the session, but then rose to end the mix almost unchanged.
The Dow rose 3.07 points (0.01%) to close at 33,852.53, while the NASDAQ fell 65.72 points (0.59%) to close at 10,983.78, and The S&P 500 fell 6.31 points (0.16%) to 3957.63.
Volatile trading on Wall Street comes amid continued uncertainty about the situation in China following widespread outcry over the country’s Covid restrictions.
Traders may also have been reluctant to make any significant moves ahead of comments from Federal Reserve Chairman Jerome Powell today that could provide further clues about the rate outlook. Unemployment data continues to be released on Friday.
In terms of economic news, the Conference Board released a report showing a moderate decline in US consumer confidence in November.
Crude oil futures ended higher on Tuesday, extending gains from the previous session on hopes that OPEC could cut production to support prices later this week. West Texas intermediate oil futures rose $0.96, or 1.2%, to $78.20 a barrel in January.
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