By Reuters | Updated: 8 June 2022
Elon Musk’s efforts to arrange new financing that will limit his cash contribution to his $44 billion (roughly Rs. 3,41,800 crore) acquisition of Twitter have been put on hold because of the uncertainty surrounding the deal, people familiar with the matter said.
Musk has been threatening to walk away from the deal unless the social media company provides him with data to back up its estimate that false or spam accounts comprise less than 5 percent of its user base. This culminated in a letter from Musk’s lawyers to Twitter on Monday warning he may walk away unless more information is forthcoming.
Musk is on the hook to pay $33.5 billion (roughly Rs. 2,60,300 crore) in cash to fund the deal after arranging debt financing to cover the rest. His liquidity is limited given that his wealth, which is pegged by Forbes at $218 billion (roughlyRs. 16,93,800 crore), is largely tied to the shares of Tesla, the electric car maker he leads.
Musk has been in discussions to arrange $2 billion (roughly Rs. 15,500 crore) to $3 billion (roughly Rs. 23,300 crore) in preferred equity financing from a group of private equity firms led by Apollo Global Management that would further reduce his cash contribution, according to the sources. These conversations are now on hold until there is clarity about the future of the acquisition, one of the sources said.
The pause in financing activities offers the first clear sign that Musk’s threats are interfering with steps that would help complete the deal. Twitter has insisted thus far that Musk has been performing his obligation under their contract, including helping to secure regulatory approval for the deal.
Spokespersons for Musk and Twitter did not respond to requests for comment. Apollo declined to comment.
Musk sold $8.5 billion (roughly Rs. 66,000 crore) worth of Tesla shares in April after he signed his deal to buy Twitter, and it is not clear how much cash he has available to meet his obligation. He has raised $7.1 billion (roughly Rs. 55,200 crore) from a group of equity co-investors to reduce his contribution. Musk also sought to reduce this exposure further by arranging a risky $12.5 billion (roughly Rs. 97,100) margin loan tied to the shares of Tesla, but then scrapped it last month.
Preferred equity would pay a fixed dividend from Twitter, in the same way that a bond or a loan pays regular interest but would appreciate in line with the equity value of the company.
The deal uncertainty has also weighed on the plans of banks to get $13 billion (roughly Rs. 1,01,000 crore) of debt they have committed to the acquisition off their books through syndication. While still preparing to syndicate the debt, the banks plan to wait until there is clarity on the deal to launch the process, the sources said.
The banks do not believe credit investors will buy into the debt as long as the uncertainty lingers, the sources said. The banks have also found Musk’s disparaging public comments about the company unhelpful, and were hoping he would be helping them by now with investor presentations to syndicate the deal, the sources added.
To be sure, the halt of these activities does not affect the commitments made by Musk and the banks to fund the deal. Twitter can take them to court to force them to comply with their financing obligations under the deal contract if they come short.
The syndication of the debt could emerge as a major issue for the banks were Musk’s dispute with Twitter to escalate in litigation and they were forced by a judge to fund the deal. In that scenario, they could struggle to get investors to buy the debt if Musk were unwilling to own the company.
That possibility, however, is seen as remote. Most investors are trading Twitter’s stock on the assumption it is far more likely for the company to reach a settlement with Musk or let him walk away, rather than go through protracted litigation.
© Thomson Reuters 2022
Elon Musk’s Messages to Twitter CEO Parag Agrawal, Jack Dorsey Revealed Ahead of October Takeover Trial
By Associated Press | Updated: 30 September 2022
Newly disclosed text messages between Elon Musk and Twitter CEO Parag Agrawal showed that the two men briefly bonded in the spring over their love of engineering — at least until Musk publicly tweeted this message early on April 9: ‘ Is Twitter dying? ‘”
That soured a relationship that appeared to bloom around the time Twitter offered the billionaire Tesla CEO a board seat after learning that he had purchased a huge stake in the company. In the texts, Agrawal questioned Musk about public criticism of Twitter, describing the comments as unhelpful and distracting within the company.
“What did you get done this week?” Musk tersely responded less than a minute later. “I’m not joining the board. This is a waste of time. Will make an offer to take Twitter private.”
The messages revealed in Delaware court filings ahead of a high-stakes trial offer a window into Twitter’s delicate negotiations with Musk. At the time, he had not only invested heavily in Twitter shares, he was publicly proposing ideas for improving it or starting an alternative.
Twitter and Musk are due in court October 17 for a trial that will decide whether the world’s richest man will be forced to complete his agreed-to $44 billion (roughly Rs. 3,58,800 crore) acquisition of Twitter. The documents were first revealed on @chancery_daily, a Twitter account that closely follows the Delaware Chancery Court, where the five-day trial will take place.
“I have a ton of ideas, but lmk if I’m pushing too hard,” Musk texted Agrawal on April 7, shortly after Twitter offered him the board seat. “I just want Twitter to be maximum amazing.”
Agrawal invited Musk to “treat me like an engineer” instead of a CEO as they worked through technical questions together. At one point, Musk wrote, “I love our conversations!”
Two days after the blowup about Musk’s “Twitter dying” tweet, on April 11, Agrawal announced Musk would not be joining the board after all. On April 14, Twitter revealed in a securities filing that Musk had offered to buy the company outright for about $44 billion (roughly Rs. 3,58,800 crore) . After first trying to thwart the hostile takeover, Twitter ended up agreeing to the deal on April 25.
The text exchanges were included in redacted documents that Musk lawyers filed early Thursday after challenging a Twitter claim that they couldn’t be made public because they contained sensitive information. Several of the “public versions” of those Twitter documents contain wholesale redactions and are almost entirely blacked out. The documents containing the Musk and Agrawal texts, by contrast, were not.
The collection of text messages also includes Musk’s conversations with Jack Dorsey, a Twitter co-founder and former CEO. Dorsey was enthusiastic about Musk’s involvement, telling him that while the board was “terrible,” Agrawal was an “incredible engineer.”
The texts also include Musk’s opinions on Twitter with a host of people in his orbit, including podcaster Joe Rogan, Oracle co-founder Larry Ellison, venture capitalists and Musk’s own brother.
While the lawyers tussle over which documents will be allowed as trial evidence, more witnesses are showing up for depositions.
Among those deposed Thursday was whistleblower Peiter “Mudge” Zatko, a former Twitter security chief who testified to Congress earlier this month about what he described as Twitter’s weak cyber defenses. Musk’s legal team hopes Zatko’s knowledge about Twitter’s problems with fake and spam accounts will bolster Musk’s key argument for terminating the deal.
Musk could be deposed as early as next week.
Facebook Must Pay Compensation to Rohingyas Over Online Hate Speech Campaign, Amnesty International Says
By Agence France-Presse | Updated: 29 September 2022
By Agence France-Presse | Updated: 29 September 2022 11:27 IST
Facebook should pay reparations to the hundreds of thousands of Rohingyas forced from their homes in Myanmar in a campaign exacerbated by rampant online hate speech, Amnesty International said in a report Thursday.
The Rohingyas, a mainly Muslim minority, were targeted by Myanmar’s military rulers in 2017 and driven into neighbouring Bangladesh, where they have since lived in sprawling refugee camps.
Victims’ associations and rights advocates say the violence was ramped up by Facebook’s algorithms, saying they play up extremist content that encourages harmful disinformation and hate speech.
“Many Rohingya tried to report anti-Rohingya content via Facebook’s ‘report’ function” but to no avail, “allowing these hateful narratives to proliferate and reach unprecedented audiences in Myanmar,” Amnesty said in its report.
It noted the revelations from the whistle-blower “Facebook Papers” divulged in October 2021, indicating that company executives knew the site fuelled the spread of toxic content against ethnic minorities and other groups.
Three legal suits have been lodged against Facebook by Rohingya representatives, in the US and Britain as well as with the OECD group of developed economies, under its guidelines for responsible business conduct.
In the US complaint, filed last December in California, the home state of Facebook and its parent company Meta, refugees are seeking $150 billion (roughly Rs. 12,27,000 crore) in damages.
“Meta’s refusal to compensate Rohingya victims to date – even where the community’s modest requests represent crumbs from the table of the company’s enormous profits – simply add to the perception that this is a company wholly detached from the reality of its human rights impacts,” Amnesty said.
The NGO urged Facebook to undertake “proactive human rights due diligence” across its platforms, but also called on national authorities to step up their oversight.
“It is imperative that states fulfil their obligation to protect human rights by introducing and enforcing effective legislation to rein in surveillance-based business models across the technology sector,” it said.
Facebook has vowed to revamp its corporate values and operations in response to pressure to clamp down on false information, particularly with regards to politics and elections.
The company has forged partnerships with several media companies, including AFP, intended to verify online posts and remove those that are untrue.
Meta Disrupts Chinese Propaganda Operation Across Facebook, Instagram Ahead of US Midterm Elections
By Reuters | Updated: 28 September 2022
Meta Platforms said on Tuesday it disrupted the first known China-based influence operation focused on targeting users in the United States with political content ahead of the midterm elections in November.
The network maintained fake accounts across Meta’s social media platforms Facebook and Instagram, as well as competitor service Twitter, but was small and did not attract much of a following, Meta said in a report summarising its findings.
Still, the report noted, the discovery was significant because it suggested a shift toward more direct interference in US domestic politics compared with previous known Chinese propaganda efforts.
“The Chinese operations we’ve taken down before talked primarily about America to the world, primarily in South Asia, not to Americans about themselves,” Meta global threat intelligence lead Ben Nimmo told a press briefing.
“Essentially the message was ‘America bad, China good,'” he said of those operations, while the new operation pushed messages aimed at Americans on both sides of divisive issues like abortion and gun rights.
Another Meta executive at the briefing said the company did not have enough evidence to say who in China was behind the activity.
Asked about Meta’s findings at a news conference, US Attorney General Merrick Garland said his office was “very concerned” about intelligence reports of election interference by foreign governments “starting back some time ago and continuing all the way into the present.”
A Twitter spokesperson said the company was aware of the information in Meta’s report and also took down the accounts.
According to Meta’s report, the Chinese fake accounts posed as liberal and conservative Americans in different states. They posted political memes and lurked in the comments of public figures’ posts since November 2021.
A sample screenshot showed one account commenting on a Facebook post by Republican Senator Marco Rubio, asking him to stop gun violence and using the hashtag #RubioChildrenKiller.
The same network also set up fake accounts that posed as people in the Czech Republic criticizing the Czech government over its approach to China, according to the report.
Meta also said it had intercepted the largest and most complex Russian-based operation since the war in Ukraine began, describing it as a sprawling network of more than 60 websites impersonating legitimate news organisations, along with about 4,000 social media accounts and petitions on sites like US-based campaign group Avaaz.
That operation primarily targeted users in Germany, as well as France, Italy, Ukraine and the United Kingdom, and spent more than $100,000 (roughly Rs. 81.8 lakh) on advertisements promoting pro-Russian messages.
On a few occasions, Russian embassies in Europe and Asia amplified the content.
The Russian embassy in Washington said Meta’s move follows “the instructions of the US authorities” and is a violation of freedom of speech.
“This suggests that American tech giants, who own the most popular Internet resources, have become servants of the US administration’s policy of suppressing dissent,” the embassy said on its Telegram channel.
© Thomson Reuters 2022
Elon Musk to Be Questioned Under Oath in Twitter Lawsuit on September 26: All Details
By Reuters | Updated: 21 September 2022
Twitter Inc will question Elon Musk under oath in Delaware next week as part of the litigation in the billionaire’s bid to walk away from his $44 billion (roughly Rs. 3,51,320 crore) deal for the social media company.
A Tuesday filing in Delaware’s Court of Chancery said Musk’s deposition is scheduled for September 26-27 and may stretch into Sept. 28 if necessary.
The two sides are locked in an increasingly acrimonious legal battle that has swept up of some of the biggest names in Silicon Valley and Wall Street.
Subpoenas have being issued to billionaire Larry Ellison, the co-founder of Oracle, Intel’s former Chief Executive Officer Robert Swan and Twitter co-founder Jack Dorsey, who is currently chief executive of Block Inc.
A five-day trial is scheduled to begin on October 17 in Wilmington, Delaware.
Each side has accused the other of breaking the April takeover agreement. Twitter wants a judge to order Musk, who is chief executive of Tesla Inc and the world’s richest person, to buy the company as agreed for $54.20 (roughly Rs. 4,300) per share.
Shares in San Francisco-based company were down slightly in early Tuesday trading at $41.54 (roughly Rs. 3,300).
On Tuesday, Bloomberg reported that court filings had revealed that Twitter co-founder Jack Dorsey would be deposed in the company’s lawsuit that is set to begin next month. Ever since Musk and Twitter reached an agreement, Dorsey has been supportive of the takeover deal for the microblogging service. He was previously subpoenaed by the Tesla CEO in August, and was to be questioned under oath by Twitter and Musk on Tuesday, according to the report.
Musk has reportedly accused the firm of concealing serious flaws in its data security. He has also alleged that Twitter hid from him that it was not complying with a 2011 agreement with the Federal Trade Commission (FTC) regarding user data, based on claims made by whistleblower and former security chief Peiter Zatko, who has also alleged that Twitter had allowed access to agents from foreign governments.
Twitter India Summoned to Appear Before DCW on September 26 Over Objectionable Content
By ANI | Updated: 20 September 2022
The Delhi Commission for Women (DCW) has summoned Twitter India and Delhi Police officials over alleged videos of child pornography and rape being shared on the social media platform. DCW took suo moto cognizance of several alleged tweets on the social media platform Twitter displaying child pornography.
“Videos of child pornography were shared on Twitter and were sold for Rs. 20. Twitter is yet to delete them and report it further. We have summoned the head of Twitter India and have sought a report. We have also summoned Delhi Police and have sought immediate action,” DCW chief Swati Maliwal told ANI.
DCW said these tweets are openly depicting videos and photographs of sexual acts involving children.
In its letter to Twitter India and Delhi Police, the Commission said, “Some of the twitter accounts engaging in these criminal acts appear to be running a racket wherein they seek money for providing pornographic and rape videos of children and women from other users of the social media platform,” said DCW.
The Commission claimed there appears to be hundreds of such objectionable videos on the social media platform which are openly displaying child pornography and rape videos of women and children.
DCW said it is deeply distressing that such illegal acts involving sexual abuse of children and young women are being publicised openly through the social media platform Twitter.
The Commission said it wishes to ascertain the steps being taken by Twitter to prevent such “filthy and outrightly criminal acts” being propagated through its medium as well as the systems in place in the platform to immediately report the same to law enforcement agencies.
“Now therefore you are hereby summoned to appear before the Commission for the purpose aforementioned on September 26. If you fail to comply with this order without lawful excuse, you will be subjected to the consequences of non-attendance as provided in law,” stated DCW.
Dutch town takes Twitter to court to remove conspiracy theories
By: Reuters, September 17, 2022
THE HAGUE, Sept 16 (Reuters) – A small Dutch town took Twitter (TWTR.N) to court on Friday to demand the social media giant takes down all messages relating to a supposed ring of satan-worshipping paedophiles that were alleged to have been active in the town in the 1980s.
Bodegraven-Reeuwijk, a town of around 35,000 inhabitants in the middle of the Netherlands, has been the focus of conspiracy theories on social media since 2020, when three men started spreading unfounded stories about the abuse and murder of children they said took place in the town in the 1980s.
The main instigator of the stories said he had childhood memories of witnessing the abuse by a group of people in Bodegraven.
The stories caused much unrest in Bodegraven, as scores of followers of the men’s tweets flocked to the local graveyard to lay flowers and written messages at the graves of seemingly random dead children, who they claimed were victims of the satanic ring.
Twitter’s lawyer Jens van den Brink declined to comment before the hearing at The Hague District Court on Friday.
Last year the same court ordered the men to immediately remove all their tweets, threats and other online content relating to the story and to make sure that none of it could ever emerge again.
But despite their conviction, stories about Bodegraven still circulate on social media as others have continued to echo their story, leading the town to take the matter up with Twitter itself.
“If conspiracy theorists don’t remove their messages, then the platforms involved need to act,” the town of Bodegraven’s lawyer Cees van de Zanden was quoted as saying by Dutch newspaper De Volkskrant on Friday.
Van de Zanden said that in July the town requested Twitter to actively find and remove all messages relating to the Bodegraven story, not only those posted by the three convicted men, but had so far not received an answer from the U.S. company.
The men behind the Bodegraven story are currently all in jail, as they have been convicted in other court cases for incitement and making death threats to a range of people including Prime Minister Mark Rutte and former health minister Hugo de Jonge.
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