Elon Musk Makes Decision on Pending Twitter Ownership Deal

Elon Musk has reportedly notified Twitter about the status of his $44 billion deal to purchase the social media platform. According to NBC, Musk is terminating the deal and had his lawyers draft a letter to the company’s chief legal officer on Friday.

Twitter’s board chairman Bret Taylor notes that the company is still open to closing the deal at the agreed-upon price and will be seeking legal help to enforce the initial deal. Musk feels differently, saying Twitter did not comply with its side of the deal and its contractual obligations.

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A big sticking point for Musk is the concern and allegations around the number of bots and spam accounts on the platform. Musk hasn’t provided any real evidence to his claims and has sought concrete data from Twitter, which they have used by experts to calculate the 5 percent figure they quote. This was not enough for Musk and his legal team, who said Twitter has “not complied with its contractual obligations” and has made “false and misleading” statements related to the data that Musk has relied on to agree to the deal.

“For nearly two months, Mr. Musk has sought the data and information necessary to ‘make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform,’” the letter reads. “This information is fundamental to Twitter’s business and financial performance and is necessary to consummate the transactions contemplated by the Merger Agreement.

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

Twitter and its board are planning to fight Musk’s decision to exit the deal, pushing to see the agreement through or to recoup the agreed-upon $1 billion penalty Musk agreed to pay if he backed out of the deal. Twitter’s stock price could also play a part in any court decision made by courts in Delaware. The company has seen its price go topsy turvy since Musk announced his decision to buy Twitter, with the billionaire offering $54.20 per share in his purchase. Now the stock is around $36 and sees Musk trying to use these declining prices as another reason to pull out.

According to Axios, the decision on Friday sets the stage for a legal showdown in Delaware which could either force Musk to go through with the deal, pay up a different deal, or just walk away by paying the $1 billion agreement price.