Twitter Trial Against Elon Musk Is Halted to Allow Deal to Close
A Delaware judge halted a court case against Elon Musk over his $44 billion purchase of Twitter Inc., giving the parties more time to complete the deal.
Delaware Chancery Judge Kathaleen St. J. McCormick said if the transaction isn't done by 5 p.m. on Oct. 28, she will set new trial dates in November, according to an order issued Thursday.
The ruling hands a partial victory to Musk, who earlier in the day had asked the judge to pause Twitter's lawsuit against him ahead of an Oct. 17 trial date. But it also gives Musk a deadline by which he needs to make good on his April agreement to pay $54.20 a share -- an obligation he previously tried to abandon. Shares in San Francisco-based Twitter rose as much as 3.5% in late trading after the judge's ruling, a sign of optimism that the order gives Twitter some of the certainty it was seeking.
Acrimony between the parties escalated Thursday, with both sides trading barbs in court filings. Musk requested a pause in the hearing, saying the social media company “will not take yes for an answer” after he proposed consummating the buyout in an Oct. 3 letter. His lawyers targeted an Oct. 28 closing. Twitter had objected to the request, saying Musk “can and should” close the deal next week.
Talks between the two sides had snagged after Musk said that his offer was now contingent on receiving $13 billion in debt financing. The original deal didn't contain such a contingency. Musk said Twitter was resisting halting court proceedings based on the “theoretical possibility of a future failure to obtain the debt financing.”
Following the judge's ruling, Twitter General Counsel Sean Edgett sent an update to staffers, saying the company won't be going to court Oct. 17 and will work to close the deal
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