Rediff.com  » Business » Elon Musk terminates $44bn deal to buy Twitter, faces legal threat

Elon Musk terminates $44bn deal to buy Twitter, faces legal threat

Source: ANI   -  Edited By: Utkarsh Mishra
July 09, 2022 08:39 IST
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Elon Musk is terminating his $44 billion deal to buy Twitter citing multiple breaches of the purchase agreement, according to a letter sent by the billionaire Tesla chief's team to Twitter.

IMAGE: Elon Musk. Photograph: Hannibal Hanschke/Reuters

'As further described below, Mr Musk is terminating the Merger Agreement because Twitter is in material breach of multiple provisions of that Agreement,' the letter said on Friday.

'In short, 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.'

 

Reacting to Musk's letter, Twitter's board chair Bret Taylor said on Saturday that they will file a lawsuit against the Tesla chief to 'force him to buy the social media company on the agreed terms'.

'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,' Taylor said in a tweet.

In April, Musk reached an acquisition agreement with Twitter at $54.20 per share in a transaction valued at approximately $44 billion.

However, Musk put the deal on hold in May to allow his team to review the veracity of Twitter's claim that less than 5 per cent of accounts on the platform are bots or spam.

Back in June, Musk had openly accused the microblogging website of breaching the merger agreement and threatened to walk away and call off the acquisition of the social media company for not providing the data he has requested on spam and fake accounts.

Musk alleged that Twitter is 'actively resisting and thwarting his information rights' as outlined by the deal, CNN reported, citing the letter he sent to Twitter's head of legal, policy and trust, Vijaya Gadde.

Musk demanded that Twitter turn over information about its testing methodologies to support its claims that bots and fake accounts constitute less than 5 per cent of the platform's active user base, a figure the company has consistently stated for years in boilerplate public disclosures.

Against this backdrop, Twitter's CEO Paraga Agrawal last month stood by his company's longtime spam metric.

'Twitter has and will continue to cooperatively share information with Mr Musk to consummate the transaction in accordance with the terms of the merger agreement,' the company said in a statement in June.

Musk has alleged that the true number of spam accounts is likely much more, potentially as high as 90 per cent.

Musk has previously said the acquisition 'cannot move forward' until the company provides 'proof' of its spam metric.

Earlier, Musk had made spam bots on the platform a central issue.

He has vowed to defeat them or 'die trying', even as he has described Twitter as being vital to 'the future of civilisation'.

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Source: ANI  -  Edited By: Utkarsh Mishra
 

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