Backtrack: Elon Musk Decides to Terminate $44 Billion Twitter Acquisition

What many feared happened. Elon Musk announced that he would refrain from buying Twitter incl.., originally agreed in $44 billion. Advisors to the billionaire businessman sent the firm a letter formally ending the agreement.

The move came after three months of speculation that began when Musk it turned out that he 9.2% shares company, and a day after sources said Washington Post that the agreement is in “serious danger” on the issue of spam and bot accounts on the platform.

Elon Musk says he will terminate his purchase agreement Twitter Inc. because the company “is a material breach of several provisions of this agreement” and apparently made “false and misleading statements” in the settlement agreement, according to document The regulator is released on Friday.

In a letter delivered to Twitter, a working group of Holding I and II, Elon Musk’s companies slated for the merger, indicate that Twitter violated certain contractual terms. Specifically, they cite Section 6.4 of the merger agreement, which “requires Twitter to provide Mr. Musk and his advisors with all data and information requested by Mr. Musk “for any reasonable business purposes related to the completion of the merger transaction.” “. According to the team, this did not happen.

The document points to repeated instances where Twitter ignored Elon Musk’s requests for access to information, mentioning that in some cases these “Requests have been denied for reasons that appear to be unfounded.”

This makes sense with the warnings the day before, in which Elon Musk’s working group determined that “Twitter is unable to verify the number of bot and spam accounts”, so this would be a violation of part of the agreement signed by both parties. The message says that “This information is critical to Twitter’s business and financial performance and is necessary to complete the transactions contemplated in the merger agreement as it is necessary to ensure that Twitter complies with the terms of the closure to facilitate the financing and financial planning of Mr. A mask for the deal and for participating in business transition planning.”

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Brad Taylor, president of Twitter, mentioned that they are “committed to closing the deal at the price and terms agreed with Musk and plan to take legal action to enforce the merger agreement.” He indicated that he was confident in the decision. rendered by the Court of the Delaware Chancery.

In a form filed with the SEC, the undersigned declare that “as well asMr. Musk also reviews the company’s recent financial results and revised outlook, and considers whether the deterioration in the company’s business and financial outlook represents a Material Adverse Impact on the company, which gives Mr. Musk a separate basis for terminating the Merger Agreement. “.

Under the terms of the purchase agreement reached in April, if the negotiations fail, the party that refuses will have to pay the amount of US$1 billion under certain circumstances. However, Musk warned that he would withdraw his investment in a 9.2% stake in the company if the board of directors did not accept his terms. For now, Twitter and Musk remain silent on social media. However, he presents in court a hostile scenario for the coming months, as the deadline for completing the transition has been set to October 2022.