On Friday, Elon Musk tweeted that he is “terminating” his purchase of the social media company, claiming in a letter that the company is “violating” the merger agreement.
Musk’s letter says he wants to get out of the deal “because Twitter is materially violating several provisions of this deal, appears to have made false and misleading representations that Musk relied on in the merger deal and is likely to be harmed.” A Material Adverse Effect on the Company (as that term is defined in the Merger Agreement).”
Twitter, for its part, said it will take legal action against Musk to secure the deal under the agreed terms.
“Twitter’s board is committed to closing the transaction at the price and terms agreed with Mr. Musk and plans to take legal action to enforce the merger agreement.” We are confident that we will prevail in the Delaware Chancery Court,” Brett Taylor, chairman of the board of directors of Twitter. on Twitter on Friday.
In particular, Musk reiterated that Twitter did not provide enough information about its bot and spam accounts on the platform and did not provide Musk and his team with enough data to do their own analysis.
In short, Twitter has not provided the information that Musk requested for nearly two months, despite his repeated detailed clarifications intended to reveal the most relevant information about Twitter’s identification, collection and disclosure that he requested in his initial requests. Friday’s letter said. “While Twitter provided some information, that information came with strings attached, restrictions used, or other artificial formatting features that made some of the information minimally useful to Musk and his aides.”
Musk also said that some key executive departures, layoffs and hiring freezes were made without consulting him first, which he says is also a deciding factor.
Under the deal, Musk could pay a $1 billion fee to get rid of the stake.
Wedbush analysts called Musk’s Friday decision a “disaster scenario for Twitter” and predicted the company’s stock would open in the $25 to $30 range on Monday morning, saying Street was cautious with any litigation. Twitter shares fell 7 percent in extended trading on Friday after opening at $37.51.
“It was always going to be a drag on Musk’s $44 billion valuation on Twitter from the start, and it never made much sense on the streets,” the analysts wrote. “It now ends (for now) in the unknown zone, which ends up on the wall behind the Twitter board, and many people on the street are scratching their heads over what comes next.
Source: Hollywood Reporter
Camila Luna is a writer at Gossipify, where she covers the latest movies and television series. With a passion for all things entertainment, Camila brings her unique perspective to her writing and offers readers an inside look at the industry. Camila is a graduate from the University of California, Los Angeles (UCLA) with a degree in English and is also a avid movie watcher.
