Twitter deal at risk: ‘deal has in some ways impaired Twitter’

By:
on Jul 8, 2022
  • Twitter's $44 billion takeover deal with Elon Musk is reportedly in 'jeopardy'.
  • Evercore ISI's Mark Mahaney reacts to the news on CNBC's "The Exchange".
  • TWTR is down over 30% from $54.20 a share that Musk agreed to pay for it.

Twitter Inc (NYSE: TWTR) is down roughly 5.0% on Friday after the Washington Post said its $44 billion buyout deal with Elon Musk is in “jeopardy”.

Mark Mahaney’s remarks on CNBC’s ‘The Exchange’

The social network says “spam” makes up less than 5.0% of its mDAUs each quarter, but the CEO of Tesla Inc, is not convinced since the figure is not verifiable.

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Consequently, he’s not engaging in “some” discussions on funding anymore, as per the Post. Reacting to the news, Mark Mahaney – Head of Internet Research at Evercore ISI said on CNBC’s “The Exchange”:

I think Twitter is a unique asset. It generates $5.0 billion a year in revenue. It’s highly influential and by the way, it generates positive free cash flow. There’s a good business here and I hate to see something like this disrupted.

Recent developments at Twitter Inc

The news comes shortly after Twitter fired Kayvon Beykpour (Head of Consumer Product) and Bruce Falck (Head of Revenue). It also laid off 30% of its talent acquisition team on Thursday. Mahaney added:

It’s a sign that there’s been a lot of disruption, a lot of turnover in a short period of time. This deal has, in some ways, impaired Twitter near-term. So, if the Board can’t conclude this deal, it’ll be dragged through the courts for years.

Musk will have to pay $1.0 billion in break-up fee if he chooses to walk away from the takeover agreement. TWTR is currently trading more than 30% down from $54.20 a share that he agreed to pay for the microblogging company.

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