Musk Dumps Deal To Buy Twitter; Firm Says It Will Sue Tesla Chief

Elon Musk announced on Friday (Saturday, July 9, 2022, in Manila) that he will abandon his $44 billion bid for Twitter after the firm failed to provide sufficient details regarding the number of its false accounts, Barbara Ortutay, Tom Krisher and Matt O’Brien reported for the Associated Press (AP).

Photo Insert: Twitter might have demanded a $1 billion breakup fee, which Musk agreed to pay under these conditions. Instead, it appears to be prepared to fight to complete the transaction.

Twitter immediately fired back, saying that it would sue Tesla CEO to enforce the agreement. The acquisition's potential unraveling was only the latest twist in a drama between the world's richest man and one of the most influential social media sites.

Twitter might have demanded a $1 billion breakup fee, which Musk agreed to pay under these conditions. Instead, it appears to be prepared to fight to complete the transaction.

“Despite what Musk may claim, this deal isn’t ending because of Twitter bots or spam accounts. This deal is collapsing because of Elon Musk’s own erratic behavior, embrace of extremists and bad business decisions,” said Angelo Carusone, president of Media Matters, a left-leaning nonprofit watchdog group that’s been critical of Musk’s Twitter bid.

Musk, he said, “made it clear that he would roll back Twitters’ community standards and safety guidelines, which would turn the platform into a fever swamp of dangerous conspiracy theories, partisan chicanery, and white supremacist radicalization.”

In a letter to Twitter’s board, Musk lawyer Mike Ringler complained that his client had for nearly two months sought data to judge the prevalence of “fake or spam” accounts on the social media platform.

“Twitter has failed or refused to provide this information. Sometimes Twitter has ignored Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Musk incomplete or unusable information,” the letter said.

Musk made the $44-billion final offer to Twitter without conducting due diligence, which is the duty of the buyer, and said Twitter can take it or leave it. Twitter took the bait. Now, Musk said the information on spam accounts is fundamental to Twitter’s business and financial performance, and is needed to finish the merger.

In response, the chair of Twitter’s board, Bret Taylor, tweeted that the board is “committed to closing the transaction on the price and terms agreed upon” with Musk and “plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.”

The trial court in Delaware frequently handles business disputes among the many corporations, including Twitter, that are incorporated there.

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