Elon Musk announced Friday afternoon that he has decided to terminate his $44 billion deal to buy Twitter – the latest twist in a whirlwind process in which the billionaire Tesla CEO became the company’s biggest shareholder, turned down a board seat, agreed to buy the social media platform and then began raising doubts about going through with the deal. The next episode in the saga is definitely going to be a court battle.
Elon Musk, the world’s richest person and CEO of Tesla, announced on Friday, July 8 that he has decided to terminate his $44 billion deal to buy Twitter mainly because the social networking company had breached several provisions of the merger agreement.
Twitter chairman Bret Taylor wrote on the micro-blogging platform: “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.”
Musk’s attorneys said in a filing that Twitter had refused or failed to respond to multiple requests for detailed information on spam or fake accounts on the platform, which is crucial to the company’s business performance.
The filing said, “Twitter is in material breach of multiple provisions of that Agreement, appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement.”
Other than that, Musk said he was walking away because Twitter fired high-ranking executives and one-third of the talent acquisition team, breaching Twitter’s duty to “preserve substantially intact the material components of its current business organization.”
Musk’s decision shall likely result in a protracted legal battle between the billionaire and the San Francisco-based company.