Elon Musk has withdrawn his $44 billion bid for Twitter. The Tesla CEO has blamed the microblogging site for failing to provide information on the bogus account.
Twitter, on the other hand, is committed to “closing the transaction at the price and terms agreed upon with Mr. Musk.” The Twitter board of directors has decided to sue Elon Musk in order to enforce the merger agreement reached between the two parties in April.
Musk’s lawyers claimed in a regulatory filing that Twitter failed to provide information about fake or spam accounts on the platform despite repeated requests. Twitter also did not provide details on its procedures for identifying and suspending such accounts.
A letter addressed to Twitter legal head Vijaya Gadde read “For nearly two months, Mr. Musk has sought the data and information necessary to ‘make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform’ (our letter to you dated May 25, 2022 (the “May 25 Letter”)).
This information is fundamental to Twitter’s business and financial performance and is necessary to consummate the transactions contemplated by the Merger Agreement because it is needed to ensure Twitter’s satisfaction with the conditions to closing, to facilitate Mr Musk’s financing and financial planning for the transaction, and to engage in transition planning for the business. Twitter has failed or refused to provide this information,”.
Musk has previously threatened to halt the transaction until the company can prove that less than 5% of Twitter accounts that see advertisements on the social media platform are bots. He claimed that 20% of Twitter accounts are fake/bots, which is four times the number reported by Twitter, but the figure could be “much higher.”
After news broke that Musk is pulling out of the $44 billion deal, twitter’s shares have taken a hit and are currently down 7 percent in extended trading.
In response to the termination, Twitter announced that it would sue Musk for abandoning the $44 billion agreement. Twitter chairman, Bret Taylor, said “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.”