The rapid 180-degree reversal of Twitter's acquisition by Musk reflects poor leadership by the company

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As it stands, Twitter isn't exactly a popular social media platform, since only about one in five Americans use it. Twitter users, even those who have accounts, are like me and only go on once every six months, even among those who have accounts. Twitter might be better described as the social media platform we all know and dislike somewhat. Although hard-core Twitter fans might struggle to describe the platform as "beloved," Twitter did play an outsized role in helping the last president launch a coup attempt against the U.S. government, and its weird mob behavior leads to a lot of dumb controversies. To me, Twitter is an unappealing possession. There would be no one asking me to acquire Twitter, of course. In any case, here are some unsolicited thoughts. There are several reasons why I would not personally invest in Twitter shares.

Elon Musk's potential acquisition of Twitter, however, has recently been highlighted as one of the biggest. A public announcement in April revealed that Elon Musk had acquired 9% of Twitter's shares. A $43 billion offer was made by Musk to buy the rest of the company at $54.22 per share. As a result of this offer, Twitter's board was not thrilled. To make it harder for Musk to acquire the company, they adopted a so-called "poison pill" shareholder rights plan on April 15. The $54.20 per share premium over Twitter's stock price at the beginning of April was quite generous. According to the Twitter stock price at the close of trading on April 1, the stock price was $39.31. The Twitter stock had a good April, in part because of the news of the potential deal, and the Twitter board reacted quickly to Musk's acquisition.

Towards the end of April, it appeared that the parties had reached an agreement on the acquisition. The deal was, however, greeted with serious reservations within two weeks of Musk's announcement. As a result of the May 12 acquisition, two top executives left Twitter, and the company announced a hiring freeze. That day, the closing Twitter share price was $45.08. Musk announced on May 13 that the deal was "temporarily on hold" due to spam accounts and bots. As a result, Twitter shares have fallen below $40 per share over the past few months. Musk officially terminated the deal on July 8, again citing concerns about bots and spam as well as Twitter's apparent unwillingness to provide adequate information. A lawsuit was filed against him by Twitter on July 12 to force him to complete the acquisition.

The leadership of Twitter went from taking serious steps to prevent Musk from acquiring the company to suing him to force him to do so in less than three months. This is not exactly a good indicator of a long-term outlook. Musk also didn't carefully think this deal through in advance, either. Musk is not a publicly traded company with shareholders who depend on a board to make good decisions on their behalf. The guy is just a rich guy who is generally good at managing and has many excellent ideas but occasionally likes to sprinkle in a real train wreck. The leadership of Twitter cannot be faulted for taking a proposal to acquire the company seriously at $54.20 per share. They almost seem to just want the deal closed so they don't have to manage Twitter anymore. It would be better for Twitter investors to focus on pushing more ads to the 20 percent of Americans arguing about various nonsense on their platform rather than waste time on the trial against Elon Musk.

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