Twitter scores early win in Elon Musk court battle

Twitter on Tuesday scored an early win in its legal challenge against billionaire Elon Musk for trying to abandon its $44 billion takeover deal, with a Delaware judge scheduling an October date for the trial.

The Tesla and SpaceX founder requested that the proceedings begin in February of 2023, while the social network company argued for an expedited trial given a continuing public dispute.

Twitter is legally challenging Mr Musk for breaching an agreement he reportedly signed, and for him to follow through with the April merger that includes paying $54.20 per share.

Mr Musk says he is seeking to terminate the agreement over claims the company has not addressed inquiries on its “spam” or bot accounts, or provided him with relevant business information.

Chancellor Kathaleen McCormick of the Court of Chancery in Delaware decided that the trial would begin in October. The Delaware court is where many US business disputes are settled.

“The reality is a delay threatens irreparable harm to the sellers,” she said of the public company. “The longer the delay, the greater the risk.”

Mr Musk has publicly tweeted challenges to Twitter, leading to several contentious months between the platform and its potential new owner.

Company lawyer William Savitt on Tuesday said Mr Musk was “engaging in sabotage".

An official date has not been set for the trial.

Last week, Twitter's stock declined from over $50 a share when the deal was announced in April to as low as $32.55.

But it was trading around $39.85 on Tuesday morning, up about 3.8 per cent and near the highest level since Mr Musk said he was walking away.

Tesla, meanwhile, was trading at $733.71, up 1.67 per cent on the day, underperforming the rest of the S&P 500, which was up 2.44 per cent.

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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Our family matters legal consultant

Name: Hassan Mohsen Elhais

Position: legal consultant with Al Rowaad Advocates and Legal Consultants.

Biography

Favourite Meal: Chicken Caesar salad

Hobbies: Travelling, going to the gym

Inspiration: Father, who was a captain in the UAE army

Favourite read: Rich Dad Poor Dad by Robert Kiyosaki and Sharon Lechter

Favourite film: The Founder, about the establishment of McDonald's