In a massive U-turn, Tesla & SpaceX CEO Elon Musk terminated his acquisition deal with Twitter on Friday, the reason for the termination is “material breach of multiple provisions of the agreement.”
According to Reuters, Musk’s lawyers stated in a filing that Twitter “failed or refused to respond to multiple requests for information on fake or spam accounts on the platform, which is fundamental to the company’s business performance.” Shares of the social media platform fell by 6%.
The termination of the $44 billion agreement was followed by intense demands by Musk to Twitter back in May, noting that he would terminate the deal if the company would not show proof that the claimed 5% of accounts on the platform consist of bots and spam.
Twitter Chairman Bret Taylor responded to the acquisition collapse by stating that the Twitter board is committed to closing the transaction on the price and terms agreed upon with Musk:
“The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.”
Elon Musk officially acquired Twitter for $44 billion in April. This comes following recent eyeing by Musk on the company as well as purchasing a $3 billion stake from the company. The agreement between Musk and Twitter stated that Twitter stockholders will receive $54.20 in cash for each share of Twitter common stock that they own. Then, the Twitter board approved the transaction and was expected to close in 2022.
The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.
— Bret Taylor (@btaylor) July 8, 2022
