Musk has been trying to step off from the Twitter deal, arguing that there are more bots on Twitter’s platform than initially disclosed.
Ives’ sees four different scenarios playing out for Musk and Twitter as they potentially seek a settlement before reaching the courtroom.
Scenario 1: “Deal ends, Musk pays $1 billion breakup fee and walks (very low likelihood in eyes of the Street).”
Scenario 2: “Specific performance’ uphold by the court; Musk needs to buy Twitter at $54.20 in the $44 billion agreed upon deal (high likelihood in the eyes of the Street).”
Scenario 3: “Musk needs to settle or pay significant damages to Twitter with Street ranges from $5 billion to $10 billion based on court ruling/trial trajectory (high likelihood).”
Scenario 4: Musk wins in Delaware and pays no breakup fee around fake account/bot information cited in 13D filing (very low likelihood).”
Ultimately, Twitter shareholders expect a deal to get done, as the stock price soared more than 4% on Wednesday following the news of Musk’s Tesla stock sales.
