Twitter Inc went on the counterattack and sued Elon Musk in Delaware court for breaching deal to buy social networking platform for a price of $44 billion, with the goal of forcing him to complete the acquisition for the price of $54.20 per share, as agreed. This appeal may develop into one of the biggest confrontations in the history of Wall Streetas noted by the Reuters agency.
“Musk apparently believes that he—unlike other parties governed by Delaware’s Business Agreements Act—is free to change his mind, trash the company’s stock market value, disrupt its operations, and walk away.” , refers to the text of the appeal.
On Friday, Musk said he was pulling out of the deal because the Twitter violated its terms by failing to respond to requests for information regarding the percentage of fake user accounts on the platform, which is critical to business performance.
Musk, who is the chief executive of electric vehicle maker Tesla Inc, did not immediately respond to a request for comment on the developments.
In its lawsuit, the company accuses Musk of a “long list” of violations of the terms of the merger agreement “that have overshadowed Twitter and its business operations.”
The company’s shares closed yesterday at $34.06, up 4.3%, but sharply down from the $50 level they were trading at when the buyout deal was approved by the company’s board of directors in late April .
THE Elon Musk said it was terminating the acquisition due to a lack of information about the fake user accounts, as well as inaccurate data presentations that resulted in “a material adverse change”. He said that the departures of managers caused problems in the day-to-day operation of the business.
Twitter has called Musk’s claims a “pretext” that lacks credibilitystating that the decision to leave has more to do with a drop in prices in the stock market, especially in the prices of shares in the technology sector, as Reuters writes and relays the Athens News Agency.
The share price of Tesla, the main img of Musk’s fortune, has lost 30% of its value since the deal was announced and closed yesterday at $699.21.
Legal experts have said that from the information that has been released, Twitter appears to have the upper hand because of how Musk negotiated the deal, refusing to do the traditional due diligence that precedes the acquisition agreements.
Source: News Beast
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