As Tesla Inc. (NASDAQ:TSLA) Elon Musk fights a legal battle to steer clear of the deal with Twitter, Inc. (NYSE:TWTR), another executive reminisced about his interest in the social media platform years ago and what kept him from going ahead with a deal.
What Happened: Back in 2016 when the board of the Walt Disney Company (NYSE:DIS) was convinced of the rationale for buying Twitter, meticulous examination showed that a “substantial portion — not a majority” of the users were not real, former CEO Bob Iger said at the 2022 Code Conference, Vox reported.
Incidentally, this is the same issue Musk took exception to and offered as an explanation for his decision to walk away from the $54.20/share deal to take Twitter private.
Iger’s initial interest in the platform stemmed from his belief that Twitter would be an ideal global distribution channel for Disney, serving as a social network where news, sports, and entertainment could be disseminated to consumers.
Iger reportedly stated that Disney, which is not a technology firm, thought it could benefit from a technology solution for getting its intellectual property in front of consumers. He said that at the time building a platform would have cost them $500 million and taken five years. He added that the world was changing quickly. So, money wasn’t the issue, it was the time.
“Yes, it’s a great solution from a distribution perspective. But it would come with so many other challenges and complexities that as a manager of a great global brand, I was not prepared to take on a major distraction and having to manage circumstances that weren’t even close to anything that we had faced before," Iger told at the conference.
Following the revelation regarding the bot accounts, Disney discounted the value heavily and the deal was “pretty cheap,” Iger said. Additionally, the former executive was concerned about the hate speech on Twitter and the potential to do “as much as good,” he said. “We’re in the business of manufacturing fun at Disney — of doing nothing but good.”
Musk Responds: Musk responded with a single-word comment when a report about Iger’s thoughts on the Twitter deal that didn’t work out was shared on Twitter. “Interesting,” he said.
Interesting …
— Elon Musk (@elonmusk) September 8, 2022
A five-day trial on the Musk-Twitter deal is set to begin in the Wilmington, Delaware Court of Chancery on Oct. 17.
Price Action: Twitter closed Wednesday’s session 6.60% higher at $41.20, according to Benzinga Pro data.
