Tesla Chief Executive Elon Musk announced Friday that he was withdrawing the $44 billion bid for Twitter, because the social media company had failed to provide information about fake accounts on the platform.
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
In a filing, Musk’s lawyers said Twitter had failed to respond or refused to respond to multiple requests for information about fake or spam accounts on the platform, which is critical to the company’s business performance.
“Twitter has breached multiple provisions of that agreement and appears to have made false and misleading statements that Mr. Musk relied upon in signing the merger agreement,” a filing to the regulator said.
Musk also said he was leaving because Twitter laid off senior executives and a third of its talent acquisition team, failing to “preserve substantially intact the material components of its existing business organization.”
The contract calls for Musk to pay Twitter $1 billion breakup if he can’t complete the deal for funding or regulatory reasons. However, the breakup fee would not apply if Musk terminates the deal on his behalf.
Musk had threatened to stop the deal unless the company showed proof that spam and bot accounts accounted for less than 5% of users who see advertising on the social networking service.
Last month, Twitter gave Musk access to its “firehose,” a raw data repository of hundreds of millions of daily tweets.
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