Here is why Elon Musk dumped Twitter deal
Elon Musk is trying to end an agreement to buy Twitter Inc. for $44 billion and take it private. Reason why he has done it is clear from his allegations that the company misrepresented user data and setting the stage for an arduous court brawl. In effect, he has indicated Twitter misrepresented how on fake accounts or bots it has.
The pullout marks a dramatic turn in a half-year saga that began with Musk building up an equity stake, lining up an elaborate financing plan and then striking a deal in April. Throughout, Musk has accused the company of misleading the public about the number of automated accounts known as spam bots on its platform, culminating with a termination letter sent Friday.
Twitter made “misleading representations” over the number of spam bots on the social network and hasn’t “complied with its contractual obligations” to provide information about how to assess how prevalent the bots are, Musk’s representatives said in the letter included in a regulatory filing.
Within minutes of the letter going public, Twitter vowed to fight back in court.
“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,” Bret Taylor, chairman of the board, said in a tweet. “We are confident we will prevail in the Delaware Court of Chancery.”
The legal tussle will play out in a court that historically frowns on efforts to scrap merger agreements and could result in a settlement whereby Musk is forced to buy Twitter, possibly under revised terms, legal scholars said.
The entire deal has been a frenzied and untraditional affair, largely played out on Twitter’s own social network. Musk, the billionaire
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