Elon Musk has notified Twitter that he’s terminating the buyout deal for the social media platform. Musk originally planned to buy Twitter at a price of $54.20 per share, in a deal valued at approximately $44 billion. However, the Tesla chief is now pulling out of the expensive commitment citing “misleading representations,” claiming that Twitter misguided him and his team about the platform’s bot problem (via NPR).
Ever since Musk’s original Twitter purchase plans became public knowledge, he repeatedly claimed on public platforms that fixing Twitter’s bot problem is among his top priorities, alongside preserving free speech since he was a “free speech absolutist” himself. In subsequent weeks, Musk targeted Twitter on numerous occasions, claiming that its fake and spam account woes were much worse than he was originally told.
He even claimed to have performed a random test and found that one-fifth of all Twitter accounts are spammy or fake. Musk also asked Twitter to give him “firehose” access to its data so that he can get a realistic view of user activity, a request that was soon approved after some reluctance, according to NPR. All of Musk’s skepticism has now come to an unsurprising conclusion, with the world’s richest man officially declaring that he no longer intends to move forward with his Twitter acquisition.
Twitter wants the deal, even in a court
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As part of a regulatory filing submitted before the US SEC and addressed to Twitter’s legal head Vijaya Gadde, Musk’s legal representative accuses the social media platform of giving “incomplete or unusable information” and that “Twitter has not complied with its contractual obligations.” But it appears that Twitter won’t let Musk back out of the deal, at least not without taking the matter to the court.
Bret Taylor, the chairperson of the Twitter board, tweeted that the company will take all measures to ensure that the deal is closed on the original terms agreed between both parties. And if that doesn’t happen, a court battle is on the horizon. Taylor wrote that the company “plans to pursue legal action to enforce the merger agreement.” It must be noted that the original agreement comes with a $1 billion fine stipulation for the party that reneges on the deal.
However, Musk pulling out of the deal is not unexpected. Experts have been warning for months that his public attacks on the company and its executive were a ploy to undervalue the deal’s final terms or fully back out of it. It now remains to be seen whether Musk’s arguments will prevail in the Delaware Court of Chancery, or if Twitter takes home the $1 billion fees and gets to live without the mercurial billionaire at its helm.