The Tesla boss withdraws from the Twitter deal.
(Photo: dpa)
san francisco Tesla CEO Elon Musk has declared his $44 billion takeover attempt over Twitter. In a stock exchange statement on Friday, Musk’s lawyers argued that Twitter misrepresented the number of fake accounts and did not want to release important company data.
“Twitter has not provided the information requested by Mr. Musk for nearly two months,” the statement said. The board of directors of Twitter announced that if necessary, they would legally force Musk to buy the platform.
Musk’s lawyers referred to the weeks-long dispute over the proportion of fake accounts: “For nearly two months, Mr. Musk has sought the data and information necessary to independently assess the prevalence of fake or spam accounts on the Twitter platform,” the letter said. “Twitter failed or refused to provide this information.”
Elon Musk himself had recently repeatedly commented on the purchase of the platform in tweets on Twitter. On Friday, however, he initially gave no information.
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According to its own account, Twitter tried to comply with Musk’s demands. In early June, the company opened up access to its service, allowing Musk and his team to receive and analyze every tweet on the platform as it was published. The company tried to assure to do everything against spam and bot. As recently as Thursday, CEO Parag Agrawal announced that more than a million spam accounts were blocked every day.
A statement from Twitter was initially not available. Its shares fell 7.5 percent to $34.05 in after-hours trading after the announcement. Musk originally offered $54.20 per share. The total volume of the project was around 44 billion dollars.
Elon Musk’s departure is a major setback for Twitter, said Wedbush analyst Dan Ives. “This is a disaster,” Ives wrote. Twitter’s share price will hover around the $25-$30 level once trading reopens on Monday, Ives predicted. “This soap opera has seen many twists and turns, and now Twitter (and its board of directors) is getting back to the drawing board.”
The company will try in court to force Musk to buy the company at a negotiated price of $44 billion. In addition, Twitter will try to pressure Musk into paying a previously negotiated fine of $1 billion, Ives predicted.
Twitter CEO Bret Tylor has announced he is ready to take legal action to force Musk to buy Twitter. “Twitter’s board of directors is committed to completing the transaction at the price and terms agreed with Mr. Musk and plans to take legal action to enforce the merger agreement.” He said he was confident his company would prevail in court .
It wouldn’t be the first time that a takeover has ultimately been confirmed in court. Tyson Foods conglomerate boss Don Tyson first signed on to buy food processor IBP but then tried to back out of the deal. IBP then went to court. In 2001, the Delaware judges ruled that the purchase agreement could not be breached.
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