Elon Musk said this week he declared the Twitter deal back on at the original purchase price of $54.20, surprising the market but not Delaware law aficionados. This time he promises to abide by his promises to abide by the merger agreement.

Whether it was the upcoming deposition or the threat of spending all day in Synagogue atoning for behavior in the Twitter saga, Musk’s capitulation shows that no matter the size of the deal, the Delaware Chancery Court and the jurisprudence around it is not messing around even if you’re the richest man in the world buying a company on a whim.  

Stars were made—looking at you @tulanelaw prof @Ann “No Relation" Lipton and @The Chancery Daily who collectively nailed this case—and billions were won and lost by investors, arbs and others in Elon’s whimsical approach to deal-making.

But as Matt Levine points out, it’s still not that simple for Musk. While the court has postponed the trial, Musk’s original debt financing and an outstanding $33.5b in funding remain in question. The debt financing is made even more complicated for the seven investment banks on the hook amidst surging bond yields. Activist investors Carl Icahn and Dan Loeb were waiting in the wings to reap hundreds of millions in profits after building up stakes as the saga unfolded these past few months.

In the newest feature of Dealmakers in Midtown Getting Coffee, GPP caught up with Breakingviews’ U.S. editor Lauren Silva Laughlin. She was unsurprised by the latest development in Twitter v. Musk. Laughlin said that this end is “fitting” despite all rationality and M&A conventional wisdom.

As for Laughlin’s crystal ball on M&A and IPOs for the rest of the year? “More of what it has been for the last several months, probably because there's no stability in interest rates. Stability in interest rates create a price-finding mechanism where buyers and sellers can then start to match up again. Until that happens, everybody will remain very apprehensive and then that affects valuations for the IPO market.”

Have a great weekend,

GPP Team 

Gladstone Place Partners “Dealmakers in Midtown Getting Coffee”: Interview with Lauren Silva Laughlin, Breakingviews

Listen Here

Bloomberg: Musk Revives $44 Billion Twitter Bid, Aiming to Avoid Trial 

Jeff Feeley, Ed Hammond and Kurt Wagner broke the news that Elon Musk has agreed to pay the originally agreed upon $54.20 in the Twitter acquisition, purportedly to avert a public trial. Read More

Axios: Banks Choking on Debt Face Losses as Musk Proceeds with Twitter Deal

Uncertainty surrounding the financing of Musk’s Twitter deal abounds, reports Michael Flaherty, as anxieties about the ability to offload debt remain high. Read More

Breakingviews: Twitter’s future isn’t just Elon Musk’s problem

John Foley discusses other uncertainties around the future of Twitter, including Musk’s ties to China, content regulation and misinformation. Read More

WSJ: Carl Icahn, Others Clean Up on Musk’s Twitter About-Face

Cara Lombardo reports on the gains made by Carl Icahn and other large institutional investors in the wake of Elon Musk’s announcement that he intends to follow through with the acquisition of Twitter, foregoing a potentially lengthy trial. Read More

CNBC: Musk must complete Twitter deal by Oct. 28 to avoid trial, judge rules

In response to Musk’s court filing requesting to call off the trial to allow more time to close the deal, Twitter pushed back with its own filing that led Delaware Chancery Court Judge Kathaleen McCormick to give Musk until October 28th to close. Read More

Bloomberg: Light & Wonder Merger with Sciplay Sought by Engine Capital

Engine Capital has urged Light & Wonder to purchase the outstanding 19% of shares it does not own in its subsidiary, Sciplay. A shareholder in both companies, Engine Capital has cited the merger as a potential catalyst for a range of improvements for both the companies. Read More

The Columbia Law School’s Blue Sky Blog: Skadden Discusses Boards, M&A and Regulatory Risk

Contributors from Skadden, Arps, Slate, Meagher & Flom address how increasing levels of regulatory scrutiny have affected the deals market, from causing corporations to balk at the idea, all the way to disincentivizing transactions altogether. Read More

Reuters: Global dealmaking plunges as financing market hits rock bottom

Reuters reporters Anirban Sen, Pamela Barbaglia and Abigail Summerville point out that rising interest rates and the strong dollar caused global M&A activity to shrink for the third consecutive quarter. Read More

The Deal: Activist Investing Today: Derek Zaba Sees M&A Activism Amid Uncertainty

While prolonged activist campaigns with multi-year improvement plans may garner lackluster support during uncertain market conditions, activists who push for M&A are primed for success according to Derek Zaba, Sidley Austin LLP partner. Read More

Reuters: U.S. Keeps Losing Antitrust Court Battles but Few Expect Pullback

Diane Bartz reports that despite a number of recent losses, federal regulators will continue to bring cases to court that threaten the integrity of antitrust law in the US. Read More

ESG NEWS

Bloomberg: Executives Are Backing Away From ESG as Recession Risks Mount

Fearing the economic fallout that would result from the ever-looming recession, CEOs across industries have begun to pull back from their ESG goals. Read More

WSJ: Fund Managers, Regulators Wrestle Over Plans to Tighten ESG Rules

Shane Shifflett reports on the ongoing debate between financial entities and government officials as the question of what “counts” as ESG is posed by the SEC. Read More

FROM OUR DESK TO YOURS

Meme stock anyone? The Netflix docuseries, “Eat the Rich: The GameStop Saga” chronicles the rise and fall of the GameStop meme stock and how the pandemic-induced explosion of retail investors has forever changed the investment landscape. If meme stocks and market volatility aren’t at the top of your list, head over to Disney+ and check out the truly lighthearted “Hocus Pocus 2.” Don’t forget your pumpkin spice latte (yes, you’re allowed one now).

If the above does not resonate with you—worry not! Swing by this week’s New York Coffee Festival, for some of the city’s best in latte art and brewing, or if you’re feeling extra adventurous, check out this year’s New York Comic Con. After all, it’s October and costumes are in! 

PEOPLE MOVES

• John Curtius, a partner at Tiger Global, will leave the VC firm in 2023. Read More

• After nearly 50 years at the helm, Bridgewater Associates founder Ray Dalio has announced he will give up control of the company but keep his Board seat. Read More

• BlackRock CFO, Gary Shedlin, will step down next year. Martin Small, the current head of the company's U.S. wealth advisory business, is expected to succeed him. Read More

• The Financial Times has appointed Nikou Asgari as its digital markets correspondent. Read More

• Bloomberg News has hired Katanga Johnson from Reuters to its Washington DC bureau to cover bank regulation. Read More

October 12, 2022: Financial Times’ Due Diligence Live

October 18, 2022: 13D Monitor Active-Passive Investor Summit

October 26, 2022: Axios BFD

November 8 – 9, 2022: Berkeley Forum on Corporate Governance