Billionaire entrepreneur Elon Musk on Friday announced that he was backing out of the $44 billion. Twitter said Musk had “mounted a public spectacle” and “trashed the company” in its filing.
Twitter Inc., has asked a Delaware, Maryland, court to force billionaire businessman Elon Musk to honor his commitment to buy the company for $44 billion (€43.8 billion).
Twitter has asked the court to force Musk to make good on his contractual agreement to buy the company at $54.20 per share as previously agreed.
What did Twitter say?
“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,” said the filing.
“Musk refuses to honor his obligations to Twitter and its stockholders because the deal he signed no longer serves his personal interests,” the company said.
Twitter filed its lawsuit in the Delaware Court of Chancery, where Twitter and many other corporations are incorporated.
Twitter has filed a lawsuit in the Delaware Court of Chancery to hold Elon Musk accountable to his contractual obligations.
— Bret Taylor (@btaylor) July 12, 2022
Why is Musk terminating the Twitter buyout deal?
Musk, announced on Friday that he was terminating the deal claiming Twitter had violated the agreement by failing to respond to requests for information regarding fake accounts on the platform.
Twitter said last month that it was providing Musk with a “firehose” of raw data on hundreds of millions of tweets. Twitter has said for years in its regulatory filings that it believes around 5% of accounts on the platform are fake.
Musk also alleges that Twitter broke the agreement when it fired two top managers and laid off a third of its talent-acquisition team.
Twitter slammed Musk’s exit strategy as a “model of hypocrisy” in its filing. According to the filing, Musk initially wanted to acquire the company and take it private as a way to purge Twitter of spam.
Twitter accuses Musk of “shifting his narrative” following a decline in Tesla stock, as he later demanded “verification” that spam was not a serious problem on Twitter’s platform. Tesla’s stock, which represents Musk’s primary source of wealth, dropped in value during a stock market selloff in May.