 Image: Chesnot/Getty Images Elon Musk says he is terminating his agreement to buy Twitter, accusing the social media platform of not complying with its contractual obligations. In a letter disclosed in an SEC filing, Musk's lawyer, Mike Ringler, claims Twitter did not provide Musk with the relevant business information he requested and accused Twitter of supplying materially inaccurate representations. More: - Ringler added that while analysis of the data Twitter supplied is ongoing, all indications suggest that several of Twitter's public disclosures regarding its mDAUs are either false or materially misleading.
- In April, Musk offered to take Twitter private for $44B, or $54.20 a share, which was accepted by Twitter's board.
- According to the terms of the deal, Musk would have to pay a $1B breakup fee if the deal doesn't go through.
- In May, Musk said the transaction was on hold pending the receipt of information on how Twitter calculates spam/bot accounts on the platform.
- Some have speculated that Musk's recent pause on the deal might be to try to negotiate a lower price for the social media platform.
- Twitter has maintained that less than 5% of its users served ads are spam accounts.
- The social media company said it removes over 1 million spam accounts daily from its platform.
- Twitter board chairman Bret Taylor tweeted that the board will pursue legal action to enforce the deal at the terms previously agreed to.
- Twitter shares have fallen in the last couple of months due to the recent market downturn, which saw the values of tech stocks plunge and uncertainty about the deal closing.
- Twitter shares closed at $38.81 on Friday, down ~5%. It dropped ~7% in after-market trading following news of the deal's termination.
In related news: - Twitter laid off about 30% of its talent acquisition team or about 100 people.
- The company said the layoffs were due to revised business needs and the company restructuring its talent acquisition team.
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 Image: WSJ Spirit Airlines has postponed its shareholders' meeting to vote for the proposed Frontier Airlines merger deal for the third time. The initial meeting to vote on the deal was set for June 10 before being pushed back to June 30 and again to July 8, amid a bidding war with JetBlue, which seeks to buy Spirit outright. Spirit said it plans to hold the vote on July 15 and will continue having deal talks with both Frontier and JetBlue until then. More: - Over the past few months, JetBlue and Frontier have proposed competing offers to partner with Spirt, Frontier through a merger agreement, and JetBlue through an acquisition.
- Frontier's stock and cash offer value Spirit at $2.4B, while JetBlue's all-cash offer values the airline at $3.6B.
- In JetBlue's latest offer, the airline included a ticking fee of 10 cents a share, raising the deal value to $34.15 per share.
- JetBlue also increased its breakup fee by $50M to $400M if the deal fails to get regulatory approval.
- Spirit has repeatedly rejected JetBlue's offer primarily due to their concern that a Spirit-JetBlue agreement would not pass regulatory approval.
- The DOJ has sued JetBlue's current partnership with American Airlines in the Northeast.
- Frontier's latest cash-and-stock offer was valued at $22.03 a share and included a $350M breakup fee.
- Frontier's offer is $4.13 in cash per share plus 1.9126 shares of Frontier for each Spirit share held.
- Either airline merging with Spirit would create the fifth-largest U.S. airline, competing with legacy players in the industry like Delta, American, United, and Southwest.
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 Federal Reserve Vice Chair Lael Brainard | Image: Evan Vucci/AP file Federal Reserve Vice Chair Lael Brainard has called for regulation in the crypto industry before it becomes a larger danger to the financial system. During a speech at a Bank of England conference, Brainard said a sound regulatory framework for the crypto financial system needs to be established now before the crypto ecosystem becomes so large or interconnected it poses risks to the stability of the broader financial system. More: - Brainard said the lack of regulatory guidelines in the crypto industry has been a confusing and troublesome issue for participants eager to develop and expand businesses.
- Following the recent crypto crash, which saw $2T wiped from the market, several lenders filing for bankruptcy, and exchanges suspending withdrawals and transfers, U.S. lawmakers and regulators have increased calls to regulate the industry.
- Since its peak in November, Bitcoin has lost about 70% of its value.
- Brainard noted that technological innovation and financial engineering cannot by themselves convert risky assets into safe ones.
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 The "Milk Crate Challenge", a viral challenge on TikTok that resulted in multiple injuries. | Image: TikTok Multiple parents are suing TikTok, accusing the platform of showing videos of the “blackout challenge,” which resulted in the death of seven children. The “blackout challenge” depicts users on TikTok using various items to cut off their oxygen supply in an attempt to see how long before they pass out. Videos of users performing this act went viral on the platform. More: - Last year, at least seven children died performing the challenge, ranging from 10 to 14 years old.
- In a separate lawsuit, the mother of 10-year-old Nylah Anderson, who passed away attempting the challenge, accuses TikTok of exceedingly and unacceptably prompting dangerous challenges on its platform.
- Responding to the lawsuits, TikTok said it had blocked users from searching for the challenge and instead directed users to one of its warning screens.
- TikTok has been under scrutiny recently related to its handling of data of U.S. users and its impact on young users.
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China's internet regulator announced new rules this week governing cross-border data transfer. The new regulations, which go into effect on Sept 1, require entities that handle data of 1 million people or more to go through "reviews" before transferring users' data abroad. More: - The rules also apply to entities that have been transferring the personal data of at least 100,000 people since Jan. 2021 and entities that have been transferring sensitive personal information of at least 10,000 since Jan. 2021.
- According to the Cyberspace Administration of China, the rules apply to "critical information infrastructure operators" such as telecommunications, defense, energy, and finance.
- The move comes as China builds up its data-governance system and cyber sovereignty.
- This has forced many multinationals operating in the country to localize their data storage and processing operations.
- Last year, China started requiring Tesla and other car companies to store locally generated data in China.
- Following the dust-up with ridesharing platform Didi, Chinese regulators began requiring online platform operators with personal data of more than 1 million users to complete a cybersecurity review before they can list shares abroad.
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Software company Oracle recently considered cost reductions of up to $1B that could result in thousands of layoffs as soon as August. According to a source, the proposed job cuts could disproportionately impact U.S. and Europe-based workers in its Marketing and eCommerce units. More: - Oracle has about 160,000 employees globally.
- The company recently added TikTok as one of its cloud customers and has been investing in its cloud services to cater to the popular social media company.
- It also counts Zoom, AT&T, and HSBC as customers.
- Oracle has been investing in its cloud services in the last six years, attempting to take a larger slice of the market dominated by AWS, Microsoft, and Google.
- In its fiscal year ended in May, Oracle’s cloud revenue grew 22% to $10.8B, about a fourth of its total revenue.
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- Japan’s longest-serving Prime Minister, Shinzo Abe, was shot and killed during a campaign speech in the western city of Nara. Abe, aged 67, was shot in the neck and left collarbone and was pronounced dead at the hospital. The police arrested 41-year-old Tetsuya Yamagami, who used a homemade gun during the attack. No motive for the shooting has been identified.
- The U.S. added 372,000 jobs in June, with employers hiring across various industries. The labor-force participation rate fell to 62.2% in June, down from 62.3% in May. June unemployment rate held at 3.6%.
- World Wrestling Entertainment (WWE) CEO Vince McMahon agreed to pay more than $12M to four women over the last 16 years to suppress sexual misconduct and infidelity allegations. All women were formerly affiliated with the WWE.
- BMW delivered 1.16 million vehicles in the first half of the year, a 13% decrease YoY. The luxury carmaker reported a 20% drop in sales in Q2; however, it saw a 110% increase in EV sales in H1.
- Meta Platforms has changed its rules requiring users of its Quest VR headset to have a Facebook account. Starting next month, new and existing users will need to create a Meta account and a Horizon social profile to use their Quest VR devices.
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 |  | Vanessa Omeokachie is a Researcher at Inside. Her interests include finance, tech, and startups. In her free time, she enjoys reading, hiking, attending music festivals, and traveling. Connect with her on Twitter @VanessaOmeo or through email at vanessa@inside.com |  | | Editor | Aaron Crutchfield is based in the high desert of California. Over the last two decades, he has spent time writing and editing at various local newspapers and defense contractors in California. When he's not working, he can often be found looking at the latest memes with his kids or working on his 1962 Ford. | |
