this post was submitted on 14 Jun 2023
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How much does this dude have to do before everyone sues the pants off of him? We should be past that stage months ago.
Well the sale took twitter private, so Elon is no longer beholdent to share holders. Don't get me wrong, he is an idiot and definitely deserves this downfall, but he can't be sued by the shareholders since twitter is now privately owned.
Sued by who? Musk is the only shareholder now. He is doing what the shareholders want.
He took it private. Bought out all of the shareholders. It's now all his, to ruin as he pleases.
That's why he tried so hard to get out of the purchase, by the way. Buying out all of the Twitter shareholders was staggeringly expensive, even by billionaire standards.
Shareholders are only beholden to the value of their shares. The offer was simply too good to pass.
Now the muskrat is the only shareholder and apparently he's happier without decorum.
He's still beholden to the banks that helped fund the purchase and has to make interest payments.
He can just sell some more TSLA ...
The banks don't care how much Twitter is specifically worth, just that they get their money from somewhere. They'll happily find Musk burning a company down if they're also confident that he'll be able to pay off his loans from somewhere else
IIRC, this toxic economic culture was started when Ford decided to pay their employees way more than their competitors, and they were still making bank and still the best in the market. Then a competitor sued them to stop them from paying their employees so well, because the competitors couldn't (ie wouldn't) compete with that.
Ford lost the lawsuit on the grounds that they were legally obligated to wring as much money out of their business to earn their shareholders and investors dividends. By paying their employees more, they weren't paying their investors more. Or some other zero-sum-game nonsense.
Public companies have a duty to protect value for their shareholders, among other obligations. This is actually not an unreasonable rule of thumb, because public companies have a multitude of owners (the shareholders) who can't always be polled on what the company should do, but one thing they have in common is that they want their investment to make money.
Private companies can do whatever the owner wants. In Twitter's case, the only other party with standing to sue Musk for destruction of shareholder value is the Saudi sovereign wealth fund (Kingdom Holdings), which declined to relinquish its stake when Musk took Twitter private. The Saudis probably don't want to raise a public stink (i) it's a loss of face, and (ii) they have more money than they know what to do with, anyway.
The mill of the law turns slowly, but it does mill fine.