Elon Musk can’t just walk away from his deal to acquire Twitter by paying an agreed-upon $1 billion breakup fee. It’s not that simple.
Musk tweeted Friday that he has decided to put his acquisition of Twitter “on hold” as he researches whether the amount of fake/spam accounts on Twitter is actually just 5%, as the company has long claimed.
He followed that tweet with another reiterating that he is still committed to the acquisition.
But he risks a lawsuit from Twitter for breach of contract that could cost the world’s wealthiest person many billions of dollars.
More than a breakup fee
Musk and Twitter agreed to a so-called reverse termination fee of $1 billion when the two sides reached a deal last month. Still, the breakup fee isn’t an option payment that allows Musk to bail without consequence.
A reverse breakup fee paid from a buyer to a target applies when there is an outside reason a deal can’t close, such as regulatory intermediation or third-party financing concerns. A buyer can also walk if there’s fraud, assuming the discovery of incorrect information has a so-called “material adverse effect.” A market dip, like the current sell-off that has caused Twitter to lose more than $9 billion in market cap, wouldn’t count as a valid reason for Musk to cut loose — breakup fee or no breakup fee — according to a senior M&A lawyer familiar with the matter.
Probably the best thing I have done over the past year was to delete my facebook account and remove twitter from my phone. I still have a Twitter account that’s tied to this blog (posts from here get an automatic tweet) but I rarely look at the timeline. I used to think that my Instagram feed was just fairly innocuous food and travel photos but I’m being fed so many ads now that I think I may just abandon that also.
The algorithms are just designed to make you outraged and keep you clicking. And they are so addictive. I realized that I could actually not check Twitter and not being “in the know” on every topic is liberating. So this study isn’t too surprising at all.
The present study aimed to understand the effects of a 1-week break from social media (SM) (Facebook, Instagram, Twitter, and TikTok) on well-being, depression, and anxiety compared with using SM as usual. We also aimed to understand whether time spent on different SM platforms mediates the relationship between SM cessation and well-being, depression, and anxiety. We randomly allocated 154 participants (mean age of 29.6 years) to either stop using SM (Facebook, Twitter, Instagram, and TikTok) for 1 week or continue to use SM as usual. At a 1-week follow-up, significant between-group differences in well-being (mean difference [MD] 4.9, 95% confidence interval [CI] 3.0–6.8), depression (MD ?2.2, 95% CI ?3.3 to ?1.1), and anxiety (MD ?1.7, 95% CI ?2.8 to ?0.6) in favor of the intervention group were observed, after controlling for baseline scores, age, and gender. The intervention effect on well-being was partially mediated by a reduction in total weekly self-reported minutes on SM. The intervention effect on depression and anxiety was partially mediated by a reduction in total weekly self-reported minutes on Twitter and TikTok, and TikTok alone, respectively. The present study shows that asking people to stop using SM for 1 week leads to significant improvements in well-being, depression, and anxiety. Future research should extend this to clinical populations and examine effects over the longer term.