Elon Musk has terminated the $44 billion Twitter deal, citing that the microblogging platform had failed to provide him proper information on the fake accounts on its site. The billionaire notified the decision in an US SEC filing, accusing the social media company of breaching “multiple provisions of the agreement”. However, Twitter’s board in a bid to still close the deal, said that it would sue Elon Musk to enforce the legal agreement. This comes after months of speculation with Musk suspending the Twitter deal, citing misinformation over fake accounts on the platform.
“Mr. Musk is terminating the Merger Agreement because 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, and is likely to suffer a Company Material Adverse Effect (as that term is defined in the Merger Agreement),” said the lawyers of the tech mogul in the SEC filing dated July 8, Sunday.
However, Twitter did not seem to be giving up so soon with the company’s chairman Bret Taylor taking to the microblogging platform to announce that it was taking legal action against Musk to enforce the deal.
“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,” said Taylor.
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
As per the deets of the agreement, Elon Musk has to pay $1 billion as a break-up penalty if the deal does not sail through for reasons including the acquisition financing falling through or regulators blocking the deal. The break-up fee would not be applicable, however, if Musk terminates the deal on his own, Reuters said in a report.
Shares of Twitter were down 6 per cent at $34.58 in extended trading. That was around 36 per cent below the $54.20 per share Elon Musk had agreed to buy Twitter for in April.
With inputs from News18