Twitter warned that it may lose key employees and have difficulty hiring during the period before it closes its $44 billion sale to Elon Musk. Twitter also warned that it could have trouble keeping advertisers on board.
“During the period prior to the closing of the merger, our business is exposed to certain inherent risks and certain restrictions on our business under the terms of the Merger Agreement that could harm our business relationships, financial condition, operating results, cash flows, and business,” Twitter said in a Securities and Exchange Commission filing on Monday.
Twitter’s stated list of risks includes “whether advertisers continue their spending on our platform” and “our inability to attract and retain key personnel and recruit prospective employees, and the possibility that our current employees could be distracted, and their productivity decline as a result, due to uncertainty regarding the merger.”
“[W]e may experience a departure of employees, prior to the closing of the merger,” Twitter’s filing also said. While this type of filing lists many risks of varying likelihood, Twitter’s concerns about keeping and hiring employees come amid reports of employee discontent about Musk buying the company. Twitter CEO “Parag Agrawal sought to quell employee anger on Friday during a company-wide meeting where employees demanded answers to how managers planned to handle an anticipated mass exodus prompted by Elon Musk,” Reuters reported.
Twitter’s SEC filing also warned that possible litigation could “prevent consummation of the merger” and that “[i]f the merger is not consummated for any reason, litigation could be filed in connection with the failure to consummate the merger.”
