First Principles | The jury’s out on @elonmusk vs @paraga - Hindustan Times
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First Principles | The jury’s out on @elonmusk vs @paraga

Oct 08, 2022 09:58 AM IST

While Twitter’s investor relations team has acknowledged that it has received word from Musk’s lawyers about their intent to pay up, we don’t know if Twitter’s board, led by Parag Agrawal, will accept.

As things stand, Twitter may either soon shut down or end up becoming an obnoxious place as a company. This has to do with that Elon Musk, the world’s richest man finally coming around to paying up $44 billion needed to acquire the company. This was the price that was originally agreed upon in April this year but soon after Musk tried to back out, exhibiting classic buyer’s remorse. He is now being almost arm- twisted into paying up.

All of Musk’s moves since his initial offer to buy Twitter, including him later dragging his feet, would suggest they are carefully thought out moves to hammer his initial offer price down.  PREMIUM
All of Musk’s moves since his initial offer to buy Twitter, including him later dragging his feet, would suggest they are carefully thought out moves to hammer his initial offer price down. 

As things stand, Twitter may either soon shut down or end up becoming an obnoxious place as a company. This has to do with that Elon Musk, the world’s richest man finally coming around to paying up $44 billion needed to acquire the company. This was the price that was originally agreed upon in April this year but soon after Musk tried to back out, exhibiting classic buyer’s remorse. He is now being almost arm- twisted into paying up.

Speaking of twist, here’s another one: While Twitter’s investor relations team has acknowledged that it has received word from Musk’s lawyers about their intent to pay up, we don’t know if Twitter’s board, led by the 38-year-old CEO Parag Agrawal, will accept. Musk may want the deal over and done with, Agrawal may want to twist the knife in deeper. We’ll have to wait over the weekend and to see how one of the greatest spectacles in tech business history will end.

All of Musk’s moves since his initial offer to buy Twitter, including him later dragging his feet, would suggest they are carefully thought out moves to hammer his initial offer price down. The New York Times reported that Musk was willing to pay up to $31 billion but Agrawal didn’t blink.

The consensus view is that Musk attempted a takeover so he could stay in the news. In any case, with Twitter going nowhere, and the kind of monies Musk and his friends have, $44 billion (the initial offer) isn’t much. The question is whether Musk every intended to pay up. Perhaps not. However, Agrawal who had taken over as CEO in November last year, was determined not to let go of this juicy offer. This is clearly evident upon going over the anatomy of the transaction in Bloomberg which makes it clear that Musk had no room to wiggle out.

Poring over leaked text messages from Elon Musk to various people that include Agrawal, and listening in to voices of people tuned to developments in Silicon Valley

suggests that while Agrawal initially imagined Musk and he had hit it off well, Agrawal did not quite realise that Musk was taking some hare-brained suggestions from friends on what a ‘new Twitter’ ought to look like. The ideas included disbanding all forms of monitoring, deliberately onboarding right-wing hate mongers, and allowing pornography. The leaked chats indicate that Musk was inclined to go with these ideas.

As is well known now, things between Musk and Agrawal started to go downhill after Musk posted a question in the public domain: “Is Twitter dying?” When Agrawal took this up with Musk, an ugly display of anger followed. Musk “pooped” on Agrawal in response to a thread to the company’s investors about the company’s plans. Soon after, Musk announced his intent to back out of the deal.

Twitter exchange between Parag Agrawal and Elon Musk. (Twitter:@paraga)
Twitter exchange between Parag Agrawal and Elon Musk. (Twitter:@paraga)

Details of how Agrawal got Musk to come back to the table are still unclear. What is clear though is that right now, there is no incentive for Agrawal to give up on trying to extract more. After all, one of Musk’s earlier text messages said that once he gains control of Twitter, one of the first things he will do is fire Agrawal. It was inevitable then that Agrawal would drag Musk to Court where these texts have been presented as evidence.

Clearly, Musk does not want more of what embarrasses him in the public domain. That is why he has done his best to stall proceedings in court citing various reasons that include being infected by Covid. Legal experts are of the view that Musk cannot renege on the commitment. Analysts say Musk stalled and attempted to back out of the Twitter deal because he lost interest in Twitter after making a bid for it. This is also why, they argue, that if he is forced to buy it, he will either disband the company altogether or let it slide.

So how will the two protagonists of this case be judged? Agrawal stands on the cusp of going down in the textbooks as a case study of how storms ought to be weathered while Musk will probably be a case study of how rich men behave when they get bored: rather stupidly.

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