Twitter is suing the law firm that used to represent Twitter. - The Verge
Twitter is suing the law firm that used to represent Twitter. - The Verge
https://www.theverge.com/2023/7/7/23787693/twitter-is-suing-the-law-firm-that-used-to-represent-twitter
The firm, which represented Twitter as Musk tried to back out of his deal to buy Twitter, received a $90 million fee for getting the deal over the finish line, according to The New York Times. Elon Musk’s Twitter alleges the payment is “unjust enrichment” and wants the fee to be returned. The NYT uploaded a PDF of the lawsuit, if you want to read it yourself.
The firm, which represented Twitter as Musk tried to back out of his deal to buy Twitter, received a $90 million fee for getting the deal over the finish line, according to The New York Times. Elon Musk’s Twitter alleges the payment is “unjust enrichment” and wants the fee to be returned.
It’ll probably only cost him $1mm to maybe recoup $90mm. He probably thinks the payoff chance is worth the pocket change. The judge really out to hit him with a frivolous lawsuit penalty.
The interest payments on the loans he took out are $1.5 Billion. That's not accounting for any other costs that Twitter was already on the hook for.
Coincidentally, Musk stopped paying all of the costs that Twitter was on the hook for. Rent, data centers, janitorial service, everything.
And he's still not going to have enough money from twitter's operations to make even the basic servicing payment on the loan.
Which is why I still think something else was going on with the Twitter sale. It doesn't make sense for anyone financially.
Unless you imagine it's a bank giveaway to Musk, who will count Twitter as a loss carry forward for years to come when it goes bellyup.
I was, and remain, 100% convinced Musk will never pay those loans. The Saudi, etc authoritarians who bankrolled him knew it was a payment to kill Twitter. The west may have forgotten the Arab spring, but they didn't, and have been scared of Twitter since
Then the banks will take possession of Twitter, and probably arrange a (fire) sale to a financial sponsor. There is no chance the banks will role over like others that Musk is not paying. It’s much more cut and dry on term loans or bridge loans.
The bank group is furious with Twitter/Musk.
Musk has always been good at selling himself, but is otherwise a fucking idiot.
Once you internalize this truth, most of his actions, and the actions of others around him, make sense.
Peter Thiel convinces Musk that it's a great idea to buy Twitter, Musk convinces a few bank managers that he's a genius and will make a lot of money, both are lying their asses off.
There were a few other players in the background, all playing on Musk's ego, all wanting Twitter to tank.
It’s definitely not a bank giveaway - the bank group is likely furious. They are hung with $13bn of debt, that is not sellable, and worse, has virtually no pathway to be sellable in the near future. It’s tough to figure out where this debt would be marked, but I would guess the Street has unrealized losses in the $3-5Bn range.