Elon Musk formally cancels USD 44 Billion Twitter deal, may get sued
The tech titan is backing out of a USD 44 billion agreement to purchase the social media platform.
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| File photo: Twitter logo and Elon Musk |
The social media platform intends to pursue legal action
Musk originally planned to buy Twitter at USD 54.20 per share in a deal valued at approximately USD 44 billion. On the other hand, Twitter is not on the same page as Elon Musk on this recent attempt to kill the acquisition deal.
Previously, Musk requested the company to share information about the number of fake and spam accounts on the social media platform. The tech billionaire is now pulling out of the expensive commitment citing "misleading representations," claiming that Twitter misguided him and his team about the platform's bot problem. The filing states,
Twitter has not provided information that Mr. Musk has requested for nearly two months notwithstanding his repeated, detailed clarifications intended to simplify Twitter's identification, collection, and disclosure of the most relevant information sought in Mr. Musk’s original requests.
In addition, the Tesla CEO charged Twitter with allegedly failing to continue to conduct its regular business or a breach of the purchase contract. Elon Musk noted it had fired two key, high-ranking employees while announcing it was laying off a third of its talent acquisition team.
In response, Twitter board chair Bret Taylor tweeted Friday the company intends to pursue legal action to close the transaction. The brief response reads,
We are committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plan to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.
Allegedly, the contract calls for Musk to pay Twitter a USD 1 billion break-up if he cannot complete the deal for reasons such as the acquisition financing falling through or regulators blocking the deal. On the other hand, the break-up fee would not be applicable if Musk terminated the agreement on his own.
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