Elon Musk, like Caesar, has a knack for triggering the knife-wielders

All industries are prone to hectic merger and acquisition activity. We covered a number of these events in the pharmaceutical industry in previous entries. Silicon Valley has reached a peak – sounds like an oxymoron! – with the giants acquiring relatively new, expensive and promising companies.

This year, Cisco CSCO paid $28 billion for enterprise cloud protection company. Splunk’s president and CEO will join Cisco’s leadership team. In a similar spirit, Alphabet GOOG acquired Photomath in 2023 for about $550 million, enriching its founder considerably.

Microsoft MSFT , the Office Suite king, sits on its giant pile of cash waiting for its next opportunity after acquiring Activision in 2023 for $69 billion. Before the deal took place, the CEO was in line to take in $500 million.

These costly transactions show that in these fast-moving industries, money flows freely and founders reap massive financial rewards. Huge piles of money make most people happy. As Caesar said, we must take the current when it serves. 

Recently, Elon Musk got into a dispute with OpenAI. Musk’s argument is that he personally financed OpenAI and had an agreement that the company would stay nonprofit and share its technology. Now the company is pushing for profit. Musk sees this as a betrayal.

The Musk-OpenAI dispute is much closer to old-time disputes between management and “corporate raiders.” Among the biggest of such battles was Icahn and Clorox CLX , $11.7 billion, 2011. After becoming its biggest shareholder, Carl Icahn fought with the Clorox board.

Musk’s OpenAI dispute follows his long, contentious acquisition of Twitter, now X. Now part of history, Musk’s Twitter acquisition uncovered the venom of his business enemies and even his newly acquired employees, some of whom profited considerably.

After the Electric Car King indicated his interest in acquiring the social media giant, the anti-Musk gang lined up, saluted and started firing. A bunch of politicians, some of whom had received hefty gifts from Musk, shuddered to think of what the acquisition would reveal about how Twitter favored certain candidates for office. They turned on their benefactor.

Some employees and executives at Twitter opposed the purchase, fearing that embarrassing practices would be exposed. If nothing else, the management style of the company would be held up for ridicule. They turned on Musk in a nasty public fit of anger.

As the Twitter situation came to a boil, people under the Twitter tent, especially rights activists, approached Apple AAPL , Disney DIS , Coca-Cola KO and others grumbling that the post-acquisition Twitter might feature racist posts and hate speech. They recommended cutting advertising. Talk about disloyalty!

Tesla TSLA and Space X have raked in billions from the federal government. Musk rubs shoulders with the top echelon in Washington. But, when critics came after him for taking over Twitter, his elected friends ran for cover or sniped at the multibillionaire. 

Like Julius Caesar, Musk is a lightning rod. Jeff Bezos, fellow billionaire and founder of Amazon AMZN , has had a long public feud with Musk over a range of issues. Musk and Meta’s META Mark Zuckerberg have also gone at each other publicly. President Biden, head of the political party that strongly advocates for electric cars, took shots at Musk for a variety of reasons, including Twitter.

As Brutus said, “Chew upon this.”

On top of his detractors, Musk’s massive wealth sent a signal that a hefty premium would be demanded for any acquisition. Warren Buffet has always had to pay significant premiums. In his 2022 acquisition of Allegheny for $11.6 billion, the Oracle paid a premium of 16%. Precision Castparts was acquired for $37 billion in 2016, which included a 21% premium. When he bought Burlington Northern Santa Fe Railroad, the premium was 31.5%. Musk’s premium for Twitter was estimated at 38% in one of the largest acquisitions ever made and puts him at the top of the list of premium payers. 

So, we see from these events that even money does not seal friendship. Plenty of people smile, appear to be friends and stab you. Win or lose any of these public battles, Musk remains a Caesar-like target.