Twitter began negotiations with Elon Musk on Sunday after he wooed shareholders with financing details on his $43 billion acquisition offer, sources said.
The company's decision to engage with Mr Musk, taken earlier on Sunday, does not mean that it will accept his $54.20 a share bid, the sources said. It signalled, however, that Twitter was exploring whether a sale to Mr Musk was possible on attractive terms.
Mr Musk, chief executive of electric car maker Tesla, has been meeting with Twitter shareholders in the past few days seeking support for his bid. He has said Twitter needs to be taken private to grow and become a genuine platform for free speech.
Many Twitter shareholders reached out to the company after Mr Musk outlined a detailed financing plan for his bid on Thursday and urged it not to let the opportunity for a deal slip away, Reuters reported earlier on Sunday.
Mr Musk's insistence that his bid for Twitter is his "best and final" offer has emerged as a hurdle in the deal negotiations, the sources said. Nevertheless, Twitter's board has decided to engage with Mr Musk to gather more information on his ability to complete the deal, and potentially get better terms, the sources added.
Twitter has not yet decided if it will explore a sale to put pressure on Mr Musk to raise his bid, according to the sources.
Twitter wants to know more about any active investigations by regulators into Mr Musk, including by the US Securities and Exchange Commission (SEC), that would present a risk to the deal being completed, one of the sources said.
Securities lawyers say that Mr Musk, who settled charges that he misled investors by suggesting four years ago he had secured funding to take Tesla private, may have breached SEC disclosure rules as he amassed a stake in Twitter earlier this year.
Twitter is also looking into whether regulators in any of the major markets it operates would object to Mr Musk owning the company, the source added. Were Twitter to establish that a sale to Mr Musk would be risky, it could ask for a sizeable break-up fee, according to the sources.
The social media company adopted a poison pill after Mr Musk made his offer to prevent him from raising his more than 9 per cent stake in the company above 15 per cent without negotiating a deal with its board. In response, Mr Musk has threatened to launch a tender offer that he could use to register Twitter shareholder support for his bid.
A concern that Twitter's board weighed was that unless it sought to negotiate a deal with Mr Musk, many shareholders could back him in a tender offer, the sources said.
While the poison pill would prevent Twitter shareholders from tendering their shares, the company is worried that its negotiating hand would weaken considerably if it was shown to be going against the will of many of its investors, the sources added.
Representatives for Twitter and Mr Musk did not immediately respond to requests for comment.
The Wall Street Journal reported earlier on Sunday that Mr Musk and Twitter would meet to discuss the acquisition offer.
The price expectations among Twitter shareholders for the deal diverge largely based on their investment strategy, the sources said.
Active long-term shareholders, who together with index funds hold the biggest chunk of Twitter shares, have higher price expectations, some in the $60-per-share range, the sources said. They are also more inclined to give Parag Agrawal, who became Twitter's chief executive in November, more time to boost the value of the company's stock, the sources added.
"I don't believe that the proposed offer by Elon Musk comes close to the intrinsic value of Twitter given its growth prospects," Saudi Arabia's Prince Alwaleed bin Talal, a Twitter shareholder, tweeted on April 14.
Short term-minded investors such as hedge funds want Twitter to accept Mr Musk's offer or ask for only a small increase, the sources said. Some of these are fretting that a recent plunge in the value of technology stocks amid concerns over inflation and an economic slowdown makes it unlikely Twitter will be able to deliver more value for itself anytime soon, the sources added.
"I would say, take the $54.20 a share and be done with it," said Sahm Adrangi, portfolio manager at Kerrisdale Capital Management, a hedge fund that owns 1.13 million shares in Twitter, or 0.15 per cent of the company, and has been an investor since early 2020.
One silver lining for Twitter's board is that Mr Musk's offer did not appear to convert much of his army of 83 million Twitter followers into new shareholders in the San Francisco-based company who could back his bid, the sources said.
Twitter's retail investor base has increased from about 20 per cent before Mr Musk unveiled his stake on April 4 to some 22 per cent, according to the sources.
Benefits of first-time home buyers' scheme
- Priority access to new homes from participating developers
- Discounts on sales price of off-plan units
- Flexible payment plans from developers
- Mortgages with better interest rates, faster approval times and reduced fees
- DLD registration fee can be paid through banks or credit cards at zero interest rates
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
New schools in Dubai
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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Dubai works towards better air quality by 2021
Dubai is on a mission to record good air quality for 90 per cent of the year – up from 86 per cent annually today – by 2021.
The municipality plans to have seven mobile air-monitoring stations by 2020 to capture more accurate data in hourly and daily trends of pollution.
These will be on the Palm Jumeirah, Al Qusais, Muhaisnah, Rashidiyah, Al Wasl, Al Quoz and Dubai Investment Park.
“It will allow real-time responding for emergency cases,” said Khaldoon Al Daraji, first environment safety officer at the municipality.
“We’re in a good position except for the cases that are out of our hands, such as sandstorms.
“Sandstorms are our main concern because the UAE is just a receiver.
“The hotspots are Iran, Saudi Arabia and southern Iraq, but we’re working hard with the region to reduce the cycle of sandstorm generation.”
Mr Al Daraji said monitoring as it stood covered 47 per cent of Dubai.
There are 12 fixed stations in the emirate, but Dubai also receives information from monitors belonging to other entities.
“There are 25 stations in total,” Mr Al Daraji said.
“We added new technology and equipment used for the first time for the detection of heavy metals.
“A hundred parameters can be detected but we want to expand it to make sure that the data captured can allow a baseline study in some areas to ensure they are well positioned.”
Sholto Byrnes on Myanmar politics
Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Jetour T1 specs
Engine: 2-litre turbocharged
Power: 254hp
Torque: 390Nm
Price: From Dh126,000
Available: Now
MATCH INFO
Wales 1 (Bale 45 3')
Croatia 1 (Vlasic 09')
Company%20Profile
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More on animal trafficking
Abu Dhabi racecard
5pm: Maiden (Purebred Arabians); Dh80,000; 1,400m.
5.30pm: Maiden (PA); Dh80,00; 1,400m.
6pm: Sheikh Zayed bin Sultan Al Nahyan National Day Cup (PA); Group 3; Dh500,000; 1,600m.
6.30pm: Sheikh Zayed bin Sultan Al Nahyan National Day Cup (Thoroughbred); Listed; Dh380,000; 1,600m
7pm: Wathba Stallions Cup for Private Owners Handicap (PA); Dh70,000; 1,400m.
7.30pm: Handicap (PA); Dh80,000; 1,600m
How it works
Booklava works on a subscription model. On signing up you receive a free book as part of a 30-day-trial period, after which you pay US$9.99 (Dh36.70) per month to gain access to a library of books and discounts of up to 30 per cent on selected titles. You can cancel your subscription at any time. For more details go to www.booklava.com
Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples.
Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts.
Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.
UAE currency: the story behind the money in your pockets
UAE currency: the story behind the money in your pockets
Total eligible population
About 57.5 million people
51.1 million received a jab
6.4 million have not
Where are the unvaccinated?
England 11%
Scotland 9%
Wales 10%
Northern Ireland 14%
RESULTS
5pm: Wathba Stallions Cup Maiden (PA) Dh 70,000 (Dirt) 1,600m
Winner: Samau Xmnsor, Abdul Aziz Al Balushi (jockey), Ibrahim Al Hadhrami (trainer)
5.30pm: Maiden (PA) Dh 70,000 (D) 1,600m
Winner: Ottoman, Szczepan Mazur, Abdallah Al Hammadi
6pm: Maiden (PA) Dh 70,000 (D) 1,800m
Winner: Sharkh, Patrick Cosgrave, Helal Al Alawi
6.30pm: Handicap (PA) Dh 85,000 (D) 1,800m
Winner: Yaraa, Fernando Jara, Majed Al Jahouri
7pm: Handicap (PA) Dh 70,000 (D) 2,000m
Winner: Maaly Al Reef, Bernardo Pinheiro, Abdallah Al Hammadi
7.30pm: Maiden (PA) Dh 70,000 (D) 1,000m
Winner: Jinjal, Fabrice Veron, Ahmed Al Shemaili
8pm: Handicap (PA) Dh 70,000 (D) 1,000m
Winner: Al Sail, Tadhg O’Shea, Ernst Oertel
Results
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How to watch Ireland v Pakistan in UAE
When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.
Scoreline
Chelsea 1
Azpilicueta (36')
West Ham United 1
Hernandez (73')
Dubai Creek Open in numbers
- The Dubai Creek Open is the 10th tournament on this year's Mena Tour
- It is the first of five events before the season-concluding Mena Tour Championship
- This week's field comprises 120 players, 21 of which are amateurs
- 15 previous Mena Tour winners are competing at Dubai Creek Golf and Yacht Club
More from Aya Iskandarani
Polarised public
31% in UK say BBC is biased to left-wing views
19% in UK say BBC is biased to right-wing views
19% in UK say BBC is not biased at all
Source: YouGov
Engine: 3.5-litre V6
Transmission: eight-speed automatic
Power: 290hp
Torque: 340Nm
Price: Dh155,800
On sale: now
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RedCrow Intelligence Company Profile
Started: 2016
Founders: Hussein Nasser Eddin, Laila Akel, Tayeb Akel
Based: Ramallah, Palestine
Sector: Technology, Security
# of staff: 13
Investment: $745,000
Investors: Palestine’s Ibtikar Fund, Abu Dhabi’s Gothams and angel investors
