SAN FRANCISCO — Elon Musk has taken control of Twitter and ousted the CEO, chief financial officer and the company’s top lawyer, two people familiar with the deal said Thursday night.
The people wouldn’t say if all the paperwork for the deal, originally valued at $44 billion, had been signed or if the deal has closed. But they said Musk is in charge of the social media platform and has fired CEO Parag Agrawal, CFO Ned Segal and Chief Legal Counsel Vijaya Gadde. Neither person wanted to be identified because of the sensitive nature of the deal.
A few hours later, Musk tweeted, “the bird has been freed,” a reference to Twitter’s logo.
The departures came just hours before a deadline set by a Delaware judge to finalize the deal on Friday. She threatened to schedule a trial if no agreement was reached.
Although they came quickly, the major personnel moves had been widely expected and almost certainly are the first of many major changes the mercurial Tesla CEO will make.
Musk privately clashed with Agrawal in April, immediately before deciding to make a bid for the company, according to text messages later revealed in court filings.
About the same time, he used Twitter to criticize Gadde, the company’s top lawyer. His tweets were followed by a wave of harassment of Gadde from other Twitter accounts. For Gadde, an 11-year Twitter employee who also heads public policy and safety, the harassment included racist and misogynistic attacks, in addition to calls for Musk to fire her. On Thursday, after she was fired, the harassing tweets lit up once again.
Musk’s changes will be aimed at increasing Twitter’s subscriber base and revenue.
In his first big move earlier on Thursday, Musk tried to soothe leery Twitter advertisers saying that he is buying the platform to help humanity and doesn’t want it to become a “free-for-all hellscape.”
The message appeared to be aimed at addressing concerns among advertisers — Twitter’s chief source of revenue — that Musk’s plans to promote free speech by cutting back on moderating content will open the floodgates to more online toxicity and drive away users.
“The reason I acquired Twitter is because it is important to the future of civilization to have a common digital town square, where a wide range of beliefs can be debated in a healthy manner, without resorting to violence,” Musk wrote in an uncharacteristically long message for the Tesla CEO, who typically projects his thoughts in one-line tweets.
He continued: “There is currently great danger that social media will splinter into far right wing and far left wing echo chambers that generate more hate and divide our society.”
Musk has previously expressed distaste for advertising and Twitter’s dependence on it, suggesting more emphasis on other business models such as paid subscriptions that won’t allow big corporations to dictate policy on how social media operates. But on Thursday, he assured advertisers he wants Twitter to be “the most respected advertising platform in the world.”
The note is a shift from Musk’s position that Twitter is unfairly infringing on free speech rights by blocking misinformation or graphic content, said Pinar Yildirim, associate professor of marketing at the University of Pennsylvania’s Wharton School.
But it’s also a realization that having no content moderation is bad for business, putting Twitter at risk of losing advertisers and subscribers, she said.
“You do not want a place where consumers just simply are bombarded with things they do not want to hear about, and the platform takes no responsibility,” Yildirim said.
Musk said Twitter should be “warm and welcoming to all” and enable users to choose the experience they want to have.
Friday’s deadline to close the deal was ordered by the Delaware Chancery Court in early October. It is the latest step in a battle that began in April with Musk signing a deal to acquire Twitter, then tried to back out of it, leading Twitter to sue the Tesla CEO to force him to go through with the acquisition. If the two sides don’t meet Friday’s deadline, the next step could be a November trial that could lead to a judge forcing Musk to complete the deal.
But Musk has been signaling that the deal is going through. He strolled into the company’s San Francisco headquarters Wednesday carrying a porcelain sink, changed his Twitter profile to “Chief Twit,” and tweeted “Entering Twitter HQ — let that sink in!”
And overnight the New York Stock Exchange notified investors that it will suspend trading in shares of Twitter before the opening bell Friday in anticipation of the company going private under Musk.
Musk is expected to speak to Twitter employees directly Friday if the deal is finalized, according to an internal memo cited in several media outlets. Despite internal confusion and low morale tied to fears of layoffs or a dismantling of the company’s culture and operations, Twitter leaders this week have at least outwardly welcomed Musk’s arrival and messaging.
Top sales executive Sarah Personette, the company’s chief customer officer, said she had a “great discussion” with Musk on Wednesday and appeared to endorse his Thursday message to advertisers.
“Our continued commitment to brand safety for advertisers remains unchanged,” Personette tweeted Thursday. “Looking forward to the future!”
Musk’s apparent enthusiasm about visiting Twitter headquarters this week stood in sharp contrast to one of his earlier suggestions: The building should be turned into a homeless shelter because so few employees actually worked there.
The Washington Post reported last week that Musk told prospective investors that he plans to cut three quarters of Twitter’s 7,500 workers when he becomes owner of the company. The newspaper cited documents and unnamed sources familiar with the deliberation.
Musk has spent months deriding Twitter’s “spam bots” and making sometimes contradictory pronouncements about Twitter’s problems and how to fix them. But he has shared few concrete details about his plans for the social media platform.
Thursday’s note to advertisers shows a newfound emphasis on advertising revenue, especially a need for Twitter to provide more “relevant ads” — which typically means targeted ads that rely on collecting and analyzing users’ personal information.
Yildirim said that, unlike Facebook, Twitter has not been good at targeting advertising to what users want to see. Musk’s message suggests he wants to fix that, she said.
Insider Intelligence principal analyst Jasmine Enberg said Musk has good reason to avoid a massive shakeup of Twitter’s ad business because Twitter’s revenues have taken a beating from the weakening economy, months of uncertainty surrounding Musk’s proposed takeover, changing consumer behaviors and the fact that “there’s no other revenue source waiting in the wings.”
“Even slightly loosening content moderation on the platform is sure to spook advertisers, many of whom already find Twitter’s brand safety tools to be lacking compared with other social platforms,” Enberg said.
Barbara Ortutay, Tom Krisher And Matt O’brien, The Associated Press
Share debacle a rare setback for Indian tycoon Adani
By Krutika Pathi in New Delhi
NEW DELHI (AP) — Indian billionaire Gautam Adani grinned as he posed this week for photos with Israeli leader Benjamin Netanyahu after acquiring one of the country’s main ports, in Haifa.
“I promise you that in the years to come, we will transform the skyline we see around us,” said Adani, his manner upbeat even as his business empire was losing billions. Investors have been dumping Adani shares for more than a week after U.S. short-selling firm Hindenburg Research put out a report alleging his businesses have engaged in fraud and stock price manipulation. The Adani group has denied this.
Before the debacle, Adani, 60, was Asia’s richest man and the third wealthiest in the world, according to Bloomberg’s Billionaires Index. Not anymore.
The massive losses are a rare setback for the coal mining tycoon from western India’s Gujarat state and raise questions about what lies ahead.
Expansion has been at the heart of Adani’s success story. The son of a middle-class family in the Gujarat capital, Ahmedabad, he quit college to become a diamond trader in the country’s financial capital, Mumbai. He returned home to join his brother in importing plastics before establishing Adani Enterprises in the 1980s, trading in everything from shoes to buckets.
Adani shifted to investing in ports, construction and coal mining as India opened up its economy in the 1990s. A new middle class emerged and the ambitious businessman placed bets on providing energy to serve them.
Adani’s first big project, Mundra Port, is now India’s largest commercial port and he is the country’s biggest private port operator. Within a decade, he also became India’s largest developer and operator of coal mines.
Today, Adani companies also operate airports in major cities, build roads, generate electricity, manufacture defense equipment, develop agricultural drones, sell cooking oil and run a media outlet. He has his eyes set on becoming the world’s largest renewable energy player by 2030.
Citing market volatility, late Wednesday his flagship Adani Enterprises scrapped a $2.5 billion share offering that, despite the bloodletting in the group’s shares and a 28% plunge that day in its own share price, had been oversubscribed.
In a video address Thursday, Adani said the share offering was canceled to “insulate investors from potential losses.”
“For me, the interest of my investors is paramount and everything else is secondary,” he said.
The share offering was seen as a test of investor confidence in the self-made industrialist, whose ascent has been celebrated as a symbol of India’s economic ambitions. The Adani Group said in a statement that canceling the offering would not “have any impact on our existing operations and future plans.”
The Adani Group said its balance sheet was “very healthy” and its history of servicing debt was “impeccable.”
Still, Brian Freitas, a New Zealand-based analyst with Periscope Analytics who has researched the Adani Group, said the collapse in share prices for India’s second-largest conglomerate may hinder its future plans for expansion.
“It’s going to be difficult for them to raise new money,” he said.
Adani shares are still losing value. Shares in Adani Enterprises tumbled 27% Thursday, while stock in six other Adani companies fell 5%-10%.
The tycoon, who favors a plain white shirt and dark trousers over fancy dress and is said to be affable and quiet spoken, slid from being the world’s third richest man to the 13th as his fortune sank to $72 billion, according to Bloomberg’s Billionaire Index. Prior to the Hindenburg report, his net worth was about $120 billion.
More vitally, the company is now without the funds it had hoped to raise in this week’s offering. Companies often launch such share offerings to finance growth while reducing debt.
“Thanks to the short-seller, Adani’s plans will get slowed down significantly,” said R.N. Bhaskar, a journalist who wrote a biography on Adani.
Analysts say that rapid expansion has largely been fueled by borrowing. The group’s debt stands at $30 billion, out of which $9 billion is from Indian banks, the group’s chief financial officer said recently.
After the stock rout of the past week, lenders may deem his group high risk and toughen their criteria for borrowing, like demanding higher interest rates or more collateral, said Freitas.
“Equity investors are going to be wary because the stock isn’t doing well — if they can’t raise equity, they will have to go to the debt market,” he added. “Given the situation, foreign lenders will think twice before lending any new money to Adani.”
Despite Adani’s longstanding ties with Prime Minister Narendra Modi, a fellow Gujarati, and other powerful politicians, the government has so far remained silent on his recent troubles even as pressure from the political opposition for an investigation into Adani’s situation grows.
In recent years, Adani has pumped money into sectors like agriculture, defense and renewable energy — all seen as high priorities for the Indian government.
Like Adani’s commitment to the port in Israel’s Haifa, many of the group’s overseas infrastructure projects, in countries such as Sri Lanka and Tanzania, have served as an Indian counterweight to rival China’s holdings.
The Haifa deal was a coup for India, located close to another port managed by the Shanghai International Port Group.
“India is working with great fervor with Israel on defense and technology, and Adani now has a port there. You think the Indian government can sniff at that?” said Bhaskar. “The thing is, you can’t wish away Adani — because he is indispensable at this point.”
He expects Adani to remain undaunted.
“The more challenging a situation gets, the more defiant and creative he becomes to overcome it,” Bhaskar said.
Senate passes Liberals’ controversial online streaming act with a dozen amendments
By Mickey Djuric in Ottawa
Big tech companies that offer online streaming services could soon be required to contribute to Canadian content as a controversial Liberal bill gets one step closer to becoming law.
The Senate has passed the online streaming act known as Bill C-11 with a dozen amendments following a lengthy study by senators.
The bill would update Canada’s broadcasting rules to reflect online streaming giants such as YouTube, Netflix and Spotify, and require them to contribute to Canadian content and make it accessible to users in Canada — or face steep penalties.
Canadian Heritage Minister Pablo Rodriguez says he hopes the House of Commons will pass the bill next week after it reviews the Senate’s changes.
Senators made amendments intended to protect user-generated content and highlight the promotion of Indigenous languages and Black content creators.
They also included a change that would prohibit CBC from producing sponsored content, and another that would require companies to verify users’ ages before they access sexually-explicit material.
Rodriguez said Thursday that the Liberal government would not accept all of the Senate’s recommendations, but he didn’t say which ones he disagrees with.
“We’ll see when the bill comes back. There are amendments that have zero impact on the bill. And others that do, and those, we will not accept them,” the minister said Thursday during a Canadian Media Producers Association panel.
The Senate also removed a clause in the bill that Sen. Paula Simons described as giving “extraordinary new powers to the government to make political decisions about things.”
Ian Scott, the former chair of Canadian Radio-television and Telecommunications Commission, had told a Senate committee that some provisions in the bill did move the balance point “slightly closer to lessening the independence” of the regulator — though he insisted that it would remain independent.
The CRTC, now under the leadership of Vicky Eatrides, will be tasked with enforcing the bill’s provisions.
The Senate passed the bill on the anniversary of its introduction in the House of Commons.
Between the House of Commons and Senate, there have been approximately 218 witnesses, 43 meetings, 119 briefs and 73 proposed amendments, said Rodriguez.
“It’s the longest bill,” he said.
The proposed law has come under intense scrutiny amid accusations from companies and critics who said it left too much room for government control over user-generated content and social-media algorithms.
Rodriguez said tech giants can get creative with ways they promote Canadian content, such as with billboards, advertising or, if they so choose, tweaks to their algorithms.
The bill has also caught the attention of the United States. Its embassy in Ottawa recently said that it is holding consultations with U.S. companies that it is concerned could face discrimination if the bill passes.
Last week, two U.S. senators called for a trade crackdown on Canada over Bill C-11, saying that the prospective law flouts trade agreements.
“I’m not worried, because we think it complies with trade obligations,” Rodriguez said.
This report by The Canadian Press was first published Feb. 2, 2023.
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