13 Jul Twitter Sues Elon Musk for Pulling Out of $44 Billion Buyout Deal
Social media giant Twitter has filed a lawsuit against Tesla and SpaceX CEO Elon Musk, seeking to force the billionaire to close the acquisition deal as agreed by both parties.
According to court documents, the complaint filed in the Delaware Court of the Chancery on Tuesday (July 12, 2022) alleges that Musk violated the terms of a merger agreement signed by both Twitter and the Tesla CEO.
The complaint stated that Musk “repeatedly disparaged Twitter and the deal” since signing the merger agreement.
Meanwhile, the latest development comes shortly after Musk terminated the deal to purchase the social media company for $44 billion, after an initial suspension. Part of the reason for the termination was that Twitter refused to provide information relating to spam bots.
However, the recent lawsuit stated that Musk’s claims were a “pretext” and without merit. An excerpt from the court document reads:
“Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he — unlike every other party subject to Delaware contract law — is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away.”
Back in April, Musk purchased a 9.2% stake in Twitter, followed by the billionaire’s appointment to the company’s board of directors. The appointment was, however, short-lived after Musk reversed his decision.
Instead, the Tesla CEO offered to buy Twitter for $44 billion, which the company accepted. Meanwhile, Twitter’s complaint alleged that Musk has been acting against the deal since the markets started declining.
According to the lawsuit, “rather than bear the cost of the market downturn, as the merger agreement requires, Musk wants to shift it to Twitter’s stakeholders.”