Source: Company e
Musk has always been active on social media, but it has also been controversial. Today's Musk is no longer satisfied with just being an active user of Twitter, but has moved from the largest shareholder to a complete acquisition.
Shareholders were angered by the "privatization of Tesla" tweets
Because of a tweet 4 years ago, Musk got into a lawsuit.
On August 7, 2018, Tesla CEO Musk tweeted that he was ready to take Tesla private at $420 per share and said that the funds were in place. As soon as the news came out, Tesla's stock price soared, from a high of $343.84 at the opening of the day to $387.46.
Subsequently, the U.S. Securities and Exchange Commission (SEC) launched an investigation into the matter, which believed that musk's funds used to privatize Tesla were of unknown origin and suspected of taking advantage of the opportunity to inflate Tesla's stock price.
Half a month later, Musk abandoned the privatization plan, and Tesla's stock price also fell sharply.
The SEC has filed civil charges and $20 million in fines against Musk and Tesla. The allegations were eventually resolved through a settlement agreement, and Musk was forced to resign as Tesla's chairman and remain CEO, agreeing to go through pre-review by the company's internal lawyers before tweeting in the future, and paying a fine of $20 million, which Tesla also paid the same amount.
Although the SEC passed the settlement, some shareholders were not satisfied and took Musk to court.
Sentencing in the case will soon be announced, with the presiding judge having ruled that Musk's tweet was a "knowing crime" and saying "no reasonable jury would consider Musk's August 7, 2018 tweet accurate or not misleading." According to foreign media statistics, if it loses the lawsuit, Tesla will face billions of dollars in damages, of which JPMorgan Chase alone claims compensation of up to $162 million.
Musk is trying to appeal the judge's ruling. According to a recent court filing, Musk's lawyers argued that the judge "parsed individual phrases for each tweet and pointed out that certain other messages should accompany the tweet, but social media platforms such as Twitter limit the number of characters per tweet."
Musk's lawyers also said the court must consider that the statements were made on social media rather than in regulatory documents when analyzing whether a statement was misleading. Counsel also claims that the defendants did not seek appeal for delay.
Musk's Twitter acquisition plans
Musk's tweets are highly followed and often controversial. For example, Musk has previously tweeted that Tesla will support Bitcoin payments, and then abandoned Bitcoin to change to Dogecoin. As a result, the prices of these two cryptocurrencies fluctuated significantly, and during this time, Musk himself sold and bought back and forth, and the benefits were very good.
There is also a lot of news about Tesla itself. In 2019, Musk tweeted that "the production line is being started rapidly." It is hoped that production will be made by the end of this year, with a capacity of about 1,000 solar roofs per week." The message was considered by the SEC to be a "production figure or sales or delivery figure" and should be subject to review, but Musk did not submit it to the legal team for review before tweeting. In addition, Musk also posted his views on Tesla's stock price on Twitter.
As his fortune has grown, Musk is no longer limited to users who only do Twitter. On April 4, Twitter submitted a report to the SEC showing that Musk bought 73.4869 million shares of Twitter's common stock, with a shareholding ratio of 9.2%, becoming Twitter's largest shareholder.
Ten days later, SEC disclosure documents showed that Musk intended to buy all of Twitter's shares in cash for $54.2 per share. At the proposed price, Musk would have to pay about $43 billion, up from $36.7 billion on Twitter's market value the day before. The news triggered Twitter to rise 6.43% on the day at $48.80 per share.
Musk also wrote to Twitter's board chairman Taylor, expressing several points:
First, the price of $54.2 per share is already "my best and final offer" and is in the interest of Twitter shareholders;
Second, Twitter is doing a poor job right now, and it has extraordinary potential, "I'll unlock it";
Third, if the acquisition is unsuccessful, the position as a majority shareholder will be reconsidered.
On the other hand, Twitter has also launched an anti-hostile takeover mechanism, known as the "Poison Pill Program": Once an entity, individual or group acquires more than 15% of Twitter's issued common stock in a transaction without board approval, Twitter will allow other shareholders to buy additional shares at a discounted price to maximize the acquisition cost.
Opinions vary as to the purpose of the acquisition. Musk himself said in the letter that the acquisition of Twitter is to make it a platform for free speech around the world. Some market views believe that the acquisition of Twitter is to build a closed loop of Musk's business empire, using social media to cooperate with hardware facilities such as cars, mobile phones, and satellite communication systems.
Musk recently said in regulatory filings that it has prepared $46.5 billion through debt and equity financing. Among them, he will take out $33.5 billion, including $21 billion in stock, and $12.5 billion in margin financing obtained by mortgaged part of Tesla stock. In addition, banks such as Morgan Stanley agreed to provide another $13 billion in debt guarantees.
Musk taunted Bill Gates
Musk's speeches often reflect the position of defending Tesla, and recently "intimidated" another rich man, Bill Gates.
Recently, some whistleblowers released a chat history between Musk and Microsoft founder Bill Gates. It is reported that this chat revolves around a charity event led by Gates, and Musk also mocked the other party because Gates was bearish on Tesla.
Musk also acknowledged the authenticity of the chat transcript on Twitter, but said it wasn't himself, it may have been circulated through friends. Musk explained that he had heard from several people at TED that Bill Gates had a short $500 million position in Tesla, so he consulted about it, which was not a secret.
As you can see from the screenshots from the chat, Musk and Gates' conversation was originally around "climate change" philanthropy, but then Musk suddenly asked Gates if he still held a $500 million Tesla short position. When Gates acknowledged this possibility, Musk bluntly said that "sorry not to accept your philanthropy on climate change, after all, you have a lot of short positions with Tesla, and Tesla is a company that has done a lot of work to solve the problem of climate change", Musk also mocked Gates with a "mother boy" expression on Twitter.
As of the latest close, Tesla reported $1005.05 per share, with a total market capitalization of $1.04 trillion.