Twitter sued Elon Musk on Tuesday (12) for violating a $44 billion deal to buy the social network. The company also asked a Delaware court to order the billionaire to complete the deal, according to a court filing.
“Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he – unlike every other party subject to Delaware contract law – is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away.”
The end of a marriage that didn’t start
Back on Friday, Musk announced the termination of the deal. The multi-billionaire entrepreneur alleges that Twitter violated its terms. The company failed to respond to requests for information about fake accounts or spam on the social network. Musk believes that this is critical to the company’s business performance.
The billionaire’s departure from the business came three months after he reached an agreement with Twitter’s board of directors. Before the purchase offer, Musk even acquired 9% of the shares of the social network.
The richest man in the world had been questioning the platform about the number of fake and spam accounts and had already threatened to back out of the purchase if he couldn’t carry out his own analysis. The social network says that fake profiles represent less than 5% of its base of 229 million users. However, Musk says that his partial analysis of data provided by the company shows higher numbers. According to his lawyers, the info about suspicious accounts is fake or materially misleading.
“Musk’s advisors’ preliminary analysis of the information provided by Twitter to date makes Musk strongly believe that the protection of fake and spam accounts included in the reported user count is much higher than 5%,” the billionaire’s lawyers said in a statement. letter sent to the SEC this Friday.”
Twitter does not accept the end
On Monday, Twitter said it had not breached any of its obligations under a merger deal with Tesla Chief Executive Elon Musk. It already announced on Friday that it will take legal action to keep the deal.
Seeing the threats, the billionaire even published a meme mocking the social network. The post has 4 sentences and pictures of him next to each statement laughing
“They said I couldn’t buy Twitter. So they wouldn’t release bot information. Now they want to force me to buy Twitter in Court. Now they have to release bot information in Court.”
A new battle begins
According to reports that cite people familiar with the matter, the trial will begin soon. The verdict, on the other hand, may take a few months to be givens. Most independent lawyers believe that Twitter’s position is superior to Elon Musk’s. The company has been doing everything in its reach to provide the necessary information about the users. If the billionaire believes that this content is not on his quality standards, then this does not really have a legal defense.
As Twitter clearly states, the whole situation is declining the company value as a whole. The company’s share prices are down by 36 percent and are below the level that was at the center of the deal ($54,20). To recall, Elon Musk bought a huge amount of the company in shares. However, we don’t know exactly what he will make of these shares now that he has retreated from the deal.
We don’t need to be a big market analyst to have suspicions about Musk’s recent attitude. Everything sounds like a move to reduce the value of Twitter. Therefore, he will be able to buy the company at a lower price than the original amount of $44 billion. Time will tell if these rumors are really accurate and if the acquisition will still happen.