The chairman of the board of directors of Twitter Inc. affirmed that they will take Elon Musk to court to continue with the merger agreement.
He’s not about to cancel the deal without a fight. Twitter Inc. will take legal action against Elon Musk after he formalized the cancellation of the company’s purchase agreement for US$44 billion.
In a publication made through his official Twitter account, the president of the board of directors of the firm, Bret Taylor , mentioned that “they are committed to closing the transaction at the price and terms agreed with Mr. Musk” and plan to undertake legal action to enforce the merger agreement.
“We are confident that we will prevail in the Delaware Court of Chancery,” Taylor said in his tweet.
At a minimum, Musk could be in hot water for a $1 billion breakup fee , under the terms of his April 25 acquisition deal with Twitter . But the deal gives him limited leeway to walk away and pay just that amount, and it’s unclear whether his complaints about Twitter account data qualify. The deal gives the firm the right to try to force you to go ahead with the acquisition if you seek to cancel it for other reasons.
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. We are confident we will prevail in the Delaware Court of Chancery.
— Bret Taylor (@btaylor) July 8, 2022
The reasons for the cancellation
Elon Musk and his advisers explained in the letter sent to Twitter Inc. that the cancellation of the merger agreement would occur for the same reason it was rumored to be in danger a few days ago: the presence of spam and bot accounts on the platform . and the poor response of the company to the tycoon to inform him about the status of these bad elements in the social network.
The regulatory filing released Friday indicates that Elon Musk will terminate his agreement to buy Twitter Inc. because the company “is in material breach of multiple provisions of that agreement” and appears to have made “false and misleading representations” in entering into the deal.
Specifically, Musk demanded more details from Twitter about the presence of harmful accounts for people who use the platform, mentioning that if it was not proven with evidence that spam accounts and bots represent less than 5% of users exposed to the advertising of the social network, would stop the negotiations.
However, the firm’s executives detailed to the press in a briefing reported by Reuters last Thursday, June 7, that Twitter detects and eliminates more than a million of this type of account daily, in addition to securing this type of user. they are well below 5%, a figure he notes has not changed in his public filings since 2013.