Bonus Episode: Elon Musk v. Twitter — with William Cohan

Negotiation

The discussion around Elon Musk's potential acquisition of Twitter highlights the complexities of legal negotiations. Scott Galloway points out that there is precedent for organizations walking away from deals, often paying a breakup fee rather than the full purchase amount 1. However, he notes that the agreement Musk signed is considered one of the most airtight in history, which complicates any attempt to back out 1. William D. Cohan suggests that a practical solution might be reached, such as Musk paying a significant fee to exit the deal, reflecting past instances where market conditions led to renegotiations 2.

It's going to go down as one of the most airtight agreements in history, where they probably screwed up was the breakup fee.

--- Scott Galloway

The potential for a practical resolution underscores the importance of strategic negotiation in high-stakes deals.

   

Court Precedents

Examining past court decisions reveals insights into how the Twitter deal might unfold. William D. Cohan argues that while the situation is unique, it is unlikely to become a landmark legal battle like the Revlon decision of 1986 3. Instead, he anticipates a practical resolution, possibly involving Musk paying a substantial fee to walk away from the deal 3. Cohan also highlights the market dynamics at play, noting that while Tesla's stock is linked to the Twitter deal, the financing for the acquisition is not yet in place 4.

Cooler heads will prevail, Scott. And the practical solution will be, let's try to either get the best new deal for our shareholders that we can get.

--- William D. Cohan

This perspective emphasizes the role of market conditions and strategic decision-making in shaping the outcome of high-profile mergers and acquisitions.