For weeks now, the Elon Musk-Twitter deal has made the news for various reasons but what has been most constant was the delay in finalizing the deal by Elon Musk who agreed to pay $44 billion for the company. Last week, Tesla’s CEO Elon Musk announced that he was terminating his acquisition of Twitter for $44 billion citing that Twitter had breached various provisions of the merger agreement.
Twitter’s board isn’t having it and its chairman Bret Taylor has announced that the board will be embarking on some legal actions to enforce the merger agreement. In a tweet he shared via his Twitter account, the chairman said that “The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement.”
The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.
— Bret Taylor (@btaylor) July 8, 2022
Elon Musk’s lawyers, on the other hand, claim that Twitter had failed and/or refused to respond to various requests for information concerning fake or spam accounts on its eponymous platform. This information which is very key to the company’s business performance was also a priority for Elon Musk and he severally stated that this was what was holding him back from completing the deal. “Twitter is in material breach of multiple provisions of that Agreement, appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement,” a filing by Elon Musk’s lawyers said.
Apart from the significant reason stated in the last paragraph, Elon Musk also said he was walking away from the deal because Twitter let go of individuals occupying significant executive roles and one-third of its talent acquisition team. According to him, this breaches the company’s obligations to “preserve substantially intact the material components of its current business organization.”
While Twitter has shown plans to embark on a legal battle, it hopes that court proceedings begin in a few weeks and the matter gets completed as shortly as possible.
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