Twitter shareholders voted to approve billionaire Tesla CEO Elon Musk’s $44 billion takeover of the social-media company, a predictable outcome in an otherwise bizarre and highly litigated merger.
Musk is currently embroiled in a high-profile court battle to get out of the deal that he initially proposed, then pressured Twitter into accepting, and ultimately agreed to in a binding contract. The trial begins in Delaware next month.
The result of today’s shareholder vote was predictable, in that investors had only two real options: make money or lose money. Twitter’s stock is currently trading around $41 per share, and if Musk’s deal closes, shareholders will be paid out $54.20 per share. It’s a good deal for them!
If Musk’s deal falls apart, is settled out of court, or if a judge rules he can get out of it when the court case goes to trial in October, the share price could plummet.
Musk’s deal, in which he paid a premium for Twitter just before the bottom fell out of the tech market, is largely believed to be buoying the company’s share price, which has risen 27% in the past six months. By comparison, the stock price of close competitor Snap has tumbled 57% in that period.
In Washington, a Twitter whistleblower, former security chief Peiter Zatko, testified before the Senate Judiciary Committee about his allegations that Twitter failed to protect user data among other charges. The testimony did not appear to affect the social media company’s share price, which has risen 1% so far today. Musk, however, is using Zatko’s arguments in court to try and wriggle out of the deal.
While the hearings were set to discuss data privacy and security, most lawmakers at the hearing focused on allegations of foreign interference and espionage within Twitter. One former Twitter employee was already found guilty for spying for Saudi Arabia and Zatko alleges that both the Indian and Chinese governments may have planted agents within Twitter.