Tesla and SpaceX boss Elon Musk warned he could give up his $ 44 billion deal to acquire the company. social media Twitter if it fails to provide the data it is looking for on fake accounts.
Interestingly, this isn’t the first time Musk has publicly suggested canceling the deal. But the warning, delivered in a letter from Musk’s attorney to Twitter’s chief legal officer is escalating. Twitter was accused of violating the agreement’s commitments.
Musk’s threats to cancel the deal coincided with the decline of many tech stocks, including the maker of auto Leaders, Tesla, amid concerns about an economic slowdown and higher interest rates in the face of inflation.
Shares of Twitter fell 1.5% to $ 39.57, well below the agreed price of $ 52.20. Investors are betting that Musk will persuade Twitter to accept a price cut on the deal or to pull out.
In the letter to Twitter, Musk’s lawyers reiterated his request for details on the bot’s accounts. In the letter, Musk said he reserves all rights to terminate the acquisition because the company has clearly breached its obligations by not providing him with information.
The company replied that it intended to conclude the agreement within the agreed terms. “Twitter continued to work with Musk to complete the transaction in compliance with the terms of the merger agreement, “the company said in a note. Musk said one of his priorities is to remove bot accounts from the platform.
Musk tweeted in mid-May that the deal was on hold and said it would not continue until the company showed. prove that bot accounts represented less than 5% of its total users. He explained that he believes bot accounts make up at least 20% of the user base.
Independent researchers have predicted that 9% to 15% of the millions of Twitter accounts could be bot accounts. In his letter from him, Musk said he needed the data to conduct his own Twitter user analysis because he didn’t believe in the methodologies of Twitter. test of the company.
Twitter abides by its papers at the United States Finance Committee
The disclaimer used in the bot account expectations offers the company protection against potential legal action. Regardless of whether those cause come from Musk on the deal or from shareholders due to the accuracy of the company’s regulatory data.
Even if Twitter’s assessment is wrong, Musk would have to make it clear that the company was trying to mislead, which is legally difficult.
Musk can abandon the deal or renegotiate it even if the law is on the company’s side, due to the time it can take for a lawsuit.
The company may find it reasonable to agree on a lower price or receive compensation from Musk. Instead of trying to force him to complete the transaction in court.
As part of the deal, Musk is contractually obligated to pay a $ 1 billion withdrawal fee if he fails to complete the deal. According to Forbes, Musk’s fortune is $ 219 billion.
And antitrust regulators decided last week not to increase scrutiny over Elon Musk’s takeover of Twitter. Consequently, the matter is unlikely to falter for regulatory reasons.
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