| I was Zooming with a Hollywood executive on Thursday afternoon when he took an elongated pause and said something that I’ve heard before so many times that I can hardly count. For context, hours earlier, David Nevins had shocked (or at least surprised) the entertainment landscape by announcing that he was stepping down from Paramount Global. This person knew that Matt Belloni would have the inside story about what really went on behind the scenes. He couldn’t wait for What I’m Hearing…, Matt’s phenomenal private email, to land in his inbox that evening.
I demurred, but indeed Matt had pinged me hours earlier, announcing that he was hunting down the details of the Nevins departure, working the phones and text threads, ferreting out the real plot. He worked ceaselessly through the evening in pursuit of the behind-the-scenes dynamics. Shortly after midnight, What I’m Hearing… contained his typically expert piece of reported analysis on the topic, How David Nevins Became the Odd Man Out.
It’s the joy of a career to work with some of the most connected, insightful, and brilliant journalists of our age, both as their editor and business partner. I’ve joked in this space, from time to time, about how CNN talent and executives fear that Dylan Byers is in their Slack channels, or even in their minds. Members of the Joint Chiefs read Julia Ioffe to understand Putin’s intentions and vulnerabilities. Walking to the subway from a book party in Brooklyn Heights on Thursday night, one high-ranking media executive marveled at how the hell Teddy Schleifer so regularly broke the news on the various pilgrimages that D.C. politicos make to the homes of megadonors in the Peninsula.
Similarly, I’ve been overwhelmed by the number of people who have approached me in the past six months to ask what Bill Cohan thought was going to happen with Elon Musk’s bizarre attempt to consummate the Twitter deal. After all, as a former M&A banker, Bill has been prescient on the topic—recognizing and writing about the various incentives around the table. Sure, the lawyers tend to get paid no matter what, but the various banks, board members, and institutional investors in Twitter had their own set of agendas throughout. And Bill has spent much of the spring and summer brilliantly explaining their financial ulterior motives.
Musk, of course, had his own machinations. And so it’s hardly a surprise that soon after he announced his desire to close the deal on his original terms, on Tuesday, the ever-vibrant Puck general Slack channel was alive with various iterations of Bill, what the hell just happened here?!?! Bill was at work on a separate column for his Wednesday private email, Dry Powder, but he quickly switched gears and dug into the deal math.
In Studio $54.20, Bill gets right to the heart of the calculation that presumably led Elon to close. As his trial in Delaware loomed and the spread between his likely financial penalty and his fresh cut of the $44 billion price tag closed, a new set of options emerged. Indeed, Elon Musk may be many things, but he is neither foolish nor insecure. And if he was going to fork over more than ten billion bucks to get out of Twitter, as some have projected, he might as well pay a little more to own and control it and make a boatload more off of it. Sure, Twitter’s market cap vastly underperforms its purchase price, but its terminal value remains material. Who is to say for certain that one of the smartest minds of a generation, no matter how smarmy, cannot turn it around? It’s a mistake to think that 2025 Twitter will look anything like the product of today.
The Twitter saga is indubitably one of the stories of our time: a battle of egos, lawyers, dealmakers, accountants, rich hangers-on, and sheds light into the ignominious way that deals sometimes close on Wall Street. And it’s precisely the sort of tale you can only find at Puck.
Have a great weekend,
Jon |
