Elon Musk officially announced that he no longer intends to finalize the purchase of Twitter, a decision that became more evident as the days went by. Unlike previous occasions, where the director himself hinted at the withdrawal of his proposal, this time he has presented a legal document to formalize it. Of course, his legal team added the reasons that led him to back down.
In recent weeks, Elon Musk had already shown his annoyance with Twitter because, according to him, the social network was not transparent about to the percentage of bots that inhabit the platform. The legal document filed today with the SEC follows the same line. “Mr. Musk is terminating the merger agreement because Twitter is in material breach of multiple provisions of that agreement. It appears to have made false and misleading representations relied upon by Mr. Musk in entering into the merger agreement, and is likely to suffer a material adverse effect for the company”; and add:
“For nearly two months, Musk has sought the data and information necessary to make an independent assessment of the prevalence of fake or spam accounts on the Twitter platform. Twitter has either failed or refused to provide this information.”
Elon Musk legal team
The text reiterates that, to go ahead with the purchase, Elon Musk had agreed to multiple conditions with Twitter, which supposedly they have not been respected. “Mr. Musk has the right to request termination of the merger agreement in the event that these material representations are determined to be false.”
Beyond the required information on the presence of bots and strategies to combat spam, Elon Musk had also requested financial data. Specifically, the financial model with which Twitter planned to face this year. According to Musk’s legal team, the Parag Agrawal-led company only offered Goldman Sachs a PDF of a board presentation.
Twitter stands firm
Although the document formalizes the intention to withdraw the offer of 44,000 million dollars, presented just last April 25, it does not mean that each party involved forgets about the situation and moves on. In fact, it is very likely that a complex legal process will arise until your purchase proposal is completely finalized; assuming we reach that port.
On twitter have already been pronounced about it and of course they plan to go ahead with the purchase process despite the decision of Elon Musk. Otherwise they will take legal action against the tycoon.
“Twitter’s board is committed to closing the transaction at the price and terms agreed with Musk and plans to take legal action to enforce the merger agreement. We are confident that we will prevail in the Delaware Court of Chancery.
Brett Taylor.
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