Why Elon Musk agreed to move forward with the $44 billion Twitter deal

Yahoo Finance’s Alexis Keenan joins the Live show to discuss the road ahead for Elon Musk after agreeing to move forward with the $44 billion Twitter acquisition deal.

Video Transcript

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BRAD SMITH: Guys, let's talk about the Musk Twitter saga, seemingly reaching its conclusion here. At least, that's what Elon Musk wants. In a surprise move, Musk went back and agreed to buy Twitter at his original price point of $44 billion, $54.20 a share. And this as a court battle with the social media company looms.

Joining us to discuss the legal implications is Yahoo! Finance's Alexis Keenan. Alexis, you were tracking this all day yesterday and some of the filings that were coming out hot and heavy from Elon Musk or X Holdings, we should say, here.

ALEXIS KEENAN: Right, so we learned about this because it came up in Twitter's SEC filings. There was a letter that went from Musk's lawyers to Twitter's board saying that we would like to go forward on this $54.20 per share basis, that $44 billion. But they said, they'd like the court, of course, to stay the litigation.

So what this looks like is the parties are getting a chance to work out the details of this so-called settlement and find a way to at least put this litigation on hold until they do it. And if Musk proves that he does close the deal, OK, then the lawsuit can officially, officially go away.

But let's talk about what perhaps broke the camel's-- well, the straw that broke the camel's back here, right? So you have Musk's deposition that was scheduled for tomorrow. That was gonna take place as many days as needed. He was gonna have to testify under oath. Also you have the judge on Monday granting a request that was made by Twitter, for Musk's circles to disclose more in discovery.

And what they wanted to dig in on was a May 6 email that was sent from an anonymous source to Musk's lawyers, and saying that they should talk offline somewhere else. Now, we don't know what happened from that email, if any follow up was done at all. But Twitter wanted to know more. So that was going to happen. And this would not then go forward if there's an agreement for the deal to go forward.

Also in Musk's pretrial-- or predeal text, I should say, they showed-- and these were the ones that we got last week. There were a lot of Musk's communications about the deal with his circles. And in those texts, he definitely showed that bots were a concern for him. And a big concern for him.

You know, and that could go both ways. On one hand, Musk was saying, that they didn't-- that Twitter didn't disclose enough about bots. But on the other hand, if he knew that they were a large problem and went forward with the deal anyway, that could arguably go against his theory.

Finally, you have potential further damage being done to Twitter as the litigation was going on, as this trial was looming. But one thing that was mentioned to me that really resonated with me was the idea that Musk, if he were to break up this deal and push even harder, that maybe his days of deal-making were threatened. And I think that's a big one.

So a lot of speculation there. But I think when you put all those pieces together, perhaps he got some advice from his lawyers, that this road was the right one to take.

BRIAN SOZZI: Well, don't close the book on it just yet because you never know. You just never know.

ALEXIS KEENAN: You never know.

BRIAN SOZZI: You never know.

ALEXIS KEENAN: Let's not close the book.

BRIAN SOZZI: Alexis Keenan, thanks so much.

ALEXIS KEENAN: Yeah.