Why Elon Musk Still Isn’t Ready to Wrap Up Twitter Deal

Nearly 40 days have passed since Elon Musk announced that his $44 billion bid to buy Twitter was “temporarily on hold,” and it appears that the two sides are still in a stalemate. During a remote Q&A at Bloomberg’s Qatar Economic Forum on Tuesday, Musk asserted that “there are still a few unresolved matters” in regard to the deal going through, including whether Twitter’s shareholders will approve it.

The remark came on the same day that Twitter’s board unanimously recommended shareholders approve Musk’s bid to buy the company in an SEC filing, stating that “the merger agreement is advisable and the merger and the other transactions contemplated by the merger agreement are…in the best interests of Twitter and its stockholders.”

Musk’s weeks of stalling have led many to speculate that he is attempting to squirm out of the deal due to the general market volatility that the Tesla CEO has repeatedly voiced concerns about. “A recession is inevitable at some point,” he told attendees of the Bloomberg event. “As to whether there is a recession in the near term, I think that is more likely than not. It’s not a certainty, but it appears more likely than not.” He also elaborated on plans to lay off a chunk of Tesla’s staff due to his “super-bad feeling” about the economy, saying that the car manufacturer will cut about 10% of its “salaried workforce, which is actually just really only a 3%, 3.5% reduction in total headcount and not super material.”

Meanwhile, he continued to justify pausing the Twitter deal by claiming that the board has not been forthcoming about the number of spam accounts on the platform. “You’ve probably read about the question as to whether the number of fake and spam users on the system is less than 5% as Twitter claims, which I think is probably not most people’s experience when using Twitter,” he said. “So we’re still awaiting resolution on that matter, and that is a very significant matter.” Twitter has worked to settle this dispute by offering to provide Musk with a “firehose” of internal data to comb through, per a Washington Post report earlier this month. This attempt at transparency appears to be a direct response to Musk’s claim that the company breached its end of the merger deal by “actively resisting and thwarting” his efforts to obtain information on the makeup of the site’s user base. Earlier this month, a Twitter spokesperson said that the company is cooperating with Musk’s data requests and plans to “close the transaction and enforce the merger agreement at the agreed price and terms.”

Rounding out the three issues that “need to be resolved” before the Twitter buyout can be completed is the question of whether the debt financing for the deal will “come together,” Musk said at the forum. (He plans to pay for the deal using $33.5 billion in personal equity and $13 billion in debt financing from a number of banks, including Morgan Stanley, Bank of America, and Barclays.) He also outlined his grandiose vision for the site, expressing hope that “80% of North America and perhaps half the world” will eventually join Twitter. “My aspiration for Twitter, or in general for the digital town square, would be that it is as inclusive—in the broader sense of the word—as possible,” he explained. “That means it must be something that is appealing to people. It obviously cannot be a place where they feel uncomfortable or harassed, or they’ll simply not use it.”

Last week Musk reiterated his desire to proceed with the acquisition during his first meeting with Twitter employees. Still, the company is currently trading at $38.63, a far cry from Musk’s $54.20-per-share offer price and a sign of continued market skepticism toward the deal’s viability.

Politics also came up on Tuesday, as Musk—who last week voted for a Republican for the first time and said he was leaning toward Ron DeSantis in 2024, should the Florida governor run for president—was asked if he’d consider voting for Donald Trump were he to enter the race. “I think I am undecided at this point on that election,” Musk said.