Twitter, as we know it, is dead. Elon Musk made sure of that when he agreed to buy back $44 billion. So far, the irreparable provocateur has escaped accountability for his eccentricity by producing enough electric cars to please Wall Street. Tesla shares are down 65% in 2022 amid a widespread sell-off in tech stocks. High debt costs mean that an Ebenezer Scrooge-like reinvention could be the trick Musk’s Resurrection.
Musk’s erratic leadership over the social media app has not been comforting. Watch employees suddenly get fired and messily roll out a new model for user verification. Twitter is advertiser bleeding and advertising revenue. With annual interest expenses on debt running up to $1 billion, Musk himself came up with the idea of bankruptcy.
Worse for Musk, he was forced to sell billions of dollars of Tesla stock amid the stock plunge to help fund the Twitter acquisition. Currently, Twitter’s business value is likely less than the $13 billion in debt it carries. Banks have not yet been able to sell that debt to the market.
The billionaire admitted that things were difficult. The manager of a social media site must ultimately cooperate with regulatory agencies and win the trust of users and marketers.
The key New Year’s resolution Lex prescribed for Musk was to acknowledge that Twitter’s previous management, whom he criticized when he tried to exit the acquisition, seemed to at least know how to run the service. service. Humility would be a good look. So it would be an admission that he needs help.
There’s also the issue of Twitter’s creditors. Currently, a number of Wall Street banks hold repurchase debt on their respective balance sheets. Musk should also be determined to negotiate a deal to revoke it at a discounted price.
Investors and the media celebrate winners, even those with character flaws. America also loves a good back story. Musk turned his back to the wall with his usual defiant demeanor. For his new profile, something more conciliatory was needed.
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