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Elon Musk’s Twitter deal and what it means for shareholders

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The Beatles memorably advised money can’t buy you love. But can Twitter buy you the least?

Elon Musk, from Forbes ranks As the richest person in the world, They reached an agreement on Monday With Twitter’s board of directors to buy all social networking shares 44 billion dollars and turn it into a private company.

Not surprisingly, buying a publicly traded company is more complicated than buying a loaf of bread or even a house. It’s not just about getting the right amount of cash, although this is an important prerequisite. It’s also about convincing the current owners to take the money.

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Musk won the Twitter executives, but the majority of shareholders still had to agree to his offer. Then, depending on the terms of the deal and how big a stake he got in the first round, he may have to take further steps to offload the rest of Twitter stock.

There are also federal laws that must be obeyed. Among them are the requirements for disclosure of potential buyers and the fiduciary obligations of the directors of the target company, whose duty is to the shareholders who elect them.

Here’s a look at some of the basics of corporate takeovers, as explained by experts in securities law and corporate governance.

Become a major shareholder

Publicly traded companies are owned by their shareholders, who are often institutional investors such as pension funds and mutual fund companies. Shareholders elect board members who are legally obligated to act in the interests of shareholders—even if they are not required to be shareholders. Board members, in turn, appoint executive directors to run the company and define its strategy.

A potential buyer usually talks to a company’s top executives before playing on a controlling stake; Having management support would help win over the board of directors, making it easier to convince shareholders to sell. Musk has taken a different path, quietly becoming the path of Twitter Largest non-institutional shareholder Before negotiating briefly with Twitter management, and then announcing his intention to buy the rest of the company’s shares.

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So why didn’t he keep buying stock in QT until he actually owned the company? Because if investors get more than 5% of the voting shares in a company, the federal government requires them to Submit a form With the US Securities and Exchange Commission within 10 days revealing how much of the company’s shares they own, how they paid for the shares – and this is the most important part – whether they plan to take control of the company.

Once this disclosure is made, any “material change” in their holdings must be disclosed – for example, the purchase or sale of at least 1% of the company’s stock in two days.

The goal, the lawyer said, is not only to protect companies from being taken over in secret, but also to limit the advantage for those who learned about a potential buyer’s plans before news reached the rest of the market. David C Mahaffey, a securities law expert at Sullivan & Worcester. “It is almost impossible to buy a large stake in a public company without anyone knowing about it,” he said.

The public learned of Musk’s interest in Twitter on April 4, when he submitted a file 13G schedule He states that he has acquired more than 9% of the company. In fact, the model indicated that it had earned more than 5% of the voting shares on Twitter by March 14 (yes, that’s more than 10 days before the model was submitted, and yes, Someone sued.)

Disclosure requirements are more stringent for shareholders who own 10% or more of a company’s stock, and there are more Rules against taking quick profits. According to the Securities and Exchange Commission, a company can recoup any profits made by shareholders (or senior company executives) if they sell shares within six months of purchasing them.

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the control

After revealing Musk’s purchases, Twitter hastened reached an agreement to give him a seat on the board until 2024 in exchange for keeping his stake below 15%. But on April 13, Musk told the Securities and Exchange Commission That he was no longer interested in a seat on the board of directors and instead wanted to buy all the shares of the company and turn it into a private company.

Musk didn’t need to buy every share to be able to impose his will on Twitter. He could have done so by taking a majority share, then using his votes to oust directors and CEOs who didn’t share his view that Twitter should be a “platform for free speech around the world,” he told the Securities and Exchange Commission. .

But to make the company private, Musk will have to buy out the rest of the shareholders — albeit with the support of Twitter’s board of directors. If the majority of shareholders vote in favor of the deal, Mahafy said, that would seal the deal.

Mahafi said shareholders who don’t like Musk’s offer have two options at this point. They can hope that the investors who own the majority of the shares will vote on the deal, or they can file a suit in the Delaware Judicial Court to try to block the deal as unfair to the shareholders. And if they vote against the deal only to see you agree to it, they can assert “valuation rights” and say their shares are worth more than Musk’s offer. But Mahafi said that in the latest trial, these claims did not yield higher profits than the original offer.

Given the size of the deal, federal antitrust enforcement is likely to review it. But the Securities and Exchange Commission won’t – it will only require its rules number of disclosures About the deal, including whether an outside analyst provided a “fair opinion” on the deal and, if so, what the basis for that opinion was.

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Musk told the Securities and Exchange Commission that Twitter “will not thrive and will not serve this societal duty [to be a platform for free speech] In its current form,” he said, adding that it “needs to go private.” One advantage of going private: Musk said it could reshape Twitter without having to respond to any other contributors. David F. larkerD., director of the Corporate Governance Research Initiative at Stanford University’s Graduate School of Business.

“If you get private, you can do whatever you want,” Larker said.

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Screenshots made by an AI director from a fake movie rage Twitter

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Scofield soon realizes that he is not alone. A small cadre of movie-obsessed artists and artists have harnessed the power of generative AI tools to reimagine classic films – or create entirely new ones – from some of the world’s most iconic names. In December, creator Johnny Darrell went viral Jodorowsky You see, a reimagining of the classic film under the eyes of groundbreaking director Alejandro Jodorowski. Inspired by Darrell, Washington-based Rob Sheridan, former art director of Nine Inch Nails, used artificial intelligence to create Jodorowsky Fraser.

Sheridan, 42, calls this AI-powered movement “The New Unreal.” Practitioners include a painter based in New Zealand Create a western space on Instagram and a sculptor from Austin, Texas, Making fake sci-fi TV shows. Another content creator from India is using AI image generators to create his own rich font Sci-fi with a Southeast Asian flavor.

“We’re starting to see this technology as something like a dream engine, leveraging a kind of distorted visual awareness to explore things that never were, never will be, never could be,” Sheridan said. “They hit you in a weird way, because they feel like They are very reasonable.”

Scofield said he didn’t know why his Cronenberg business was catching fire so quickly. He’s posted several previous experiments on Imgur, Reddit, and Twitter, all of which only got between 50 and 100 likes. “The intention was not to create a clickbait site, but I think it turned into that,” he said. “A lot of people were reposting it and saying, This is terrible. This man does not understand Cronenberg at all.Each time they did, it spread further and incited another wave of criticism, which incited another, and another, and another.

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Schoefield said the text of his tweet — simply “David Cronenberg’s Galaxy of Flesh (1985)” — could give the false impression that he was trying to deceive Twitter. “There is no real intent behind this title yet, Oh yeah, looks like that could be it,” he said. “But he seemed to really impress people, and I think someone like Cronenberg might be famous enough to have a fanbase.

He continued, “There are a lot of people who have opinions about what Cronenberg’s aesthetics are and what they are not, and what a bad interpretation of his style is.” He fears that people will think he is trying to reduce Cronenberg’s work to mere physical horror.

The frames themselves were created by giving Midjourney a “DVD screen” prompt of various scenes from the film The empire strikes. Then it was like: Everything is made of skin, joints, tendons, nerves, umbilical cords, stomach, and arteriesSchofield added.

Getting a photo creator to make blood was hard — like getting Cronenberg style. “You can’t even write ‘Cronenberg’ in Midjourney,” Scofield said. (Sheridan thinks it’s because of him: He made a series of Cronenberg-inspired photos for the Met Gala in May, and Soon after, the term “Cronenberg” was banned from the tool.)



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We used AI to write articles about CNET writing with AI

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Technology news site CNET discovered that he uses artificial intelligence (AI) to write articles about personal finance without any prior advertising or explanation. The articles, which numbered 73, covered topics such as What is Zelle and how does it work?“And it has a small disclaimer at the bottom of every read” This article was created using automation technology and has been carefully edited and fact-checked by an editor on our editorial team. The subheadings in these articles read “CNET Money Staff” generated by artificial intelligence.

The use of AI to write these articles was first revealed by a Twitter user, and further investigation revealed that the articles had been created using AI since November 2022. The extent and form of AI currently used by CNET is not known as the company did not respond to questions about their use for artificial intelligence.

The use of AI in journalism raises questions about the transparency and ethics of this practice as well as the potential impact on the veracity and accuracy of news. In addition, it also raises concerns about the implications it may have on SEO and Google searches. The lack of response from CNET regarding their use of AI in writing articles has heightened concerns and sparked a broader discussion about the future of journalism and AI’s role in it.

Note: This entire article was written by ChatGPT and reviewed by a human editor. (In fact, we had to rewrite the prompt several times to get it to stop throwing real-world errors. Also, CNET did not respond to a human journalist’s request for comment.)

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Elon Musk has officially lost more private money than anyone else in history

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Bill Buckner. Justin Guarini. Everyone who “ran” against Vladimir Putin. Now Elon Musk has joined the ranks of the biggest losers in history. the Awarded by the Guinness Book of World Records CEO of Tesla, SpaceX, and Twitter, a record-breaking loss of personal wealth. Forbes has estimated that in the past year or so, Musk’s wealth has declined by $182 billion.

In November 2021, Musk’s wealth peaked at nearly $320 billion, making him the richest man in the world. Most of that, however, was Tesla stock, which has plummeted in value through 2022. His October 2022 purchase of Twitter for $44 billion — which he financed with some of his Tesla stock — also caused a huge buzz in his bottom line.

In December, Musk’s losses stripped off His top of Forbes existingAnd the title of the richest person in the world went to Bernard Arnault from the LVMH Group, which owns such luxury brands as Louis Vuitton, Dior and Sephora. Forbes noted That many other billionaires will take big losses in 2022, when technology stocks will be hit hard. Jeff Bezos lost $85 billion, and Mark Zuckerberg saw $77 billion of his wealth disappear.

The previous world record for largest loss of personal wealth was held by Masayoshi Son, CEO of Softbank, who lost more than $59 billion during the dot-com crash of 2000. Today, Son is ranked 67th on Forbes’ list of billionaires.

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