The prominent Twitter user as well as the world’s richest man, Elon Musk has announced that he is pulling out of his $44 billion Twitter deal, citing multiple breaches of the merger agreement.
It seems the Doge community will have to take chill pills as regards their excitement regarding the self-acclaimed “Dogefather” intent to buy 100% of Twitter after many of them have been waiting for what will become of Dogecoin after Elon Musk Twitter takeover.
Elon Musk earlier this year, announced his intention to acquire the popular microblogging platform, Twitter in a deal worth $44 billion, equivalent to $54.2 per share, a deal much more worthy than the current Twitter worth. Twitter initially rejected the bid but later agreed to Musk’s proposal.
However, according to the information disclosed through the US Securities and Exchange Commission (SEC), Elon Musk is pulling out of the bid to takeover Twitter due to a number of reasons.
Elon Musk in his reasons claimed that Twitter has not complied with the contractual obligations to provide him and his advisors with all the information and data he requests “for any reasonable business purpose related to the consummation of the transaction.”
Musk also says that for almost two months, he has sought the data and information necessary to “make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform.”
He claims that the information was vital to Twitter’s business and financial performance and is essential to consummate the transactions contemplated by the Merger Agreement as it is necessary to ensure Twitter satisfaction with the conditions to closing, to facilitate Mr. Musk’s financing and financial planning for the transaction, and to engage in transition planning for the business.
He, however, claimed that Twitter Inc. has refused to disclose this information to him, a request that Twitter sometimes ignored, or rejected for unjustified reasons, Twitter sometimes agrees to provide this information but ended up with incomplete or unusable information.
In the information disclosed by SEC, Musk also said that his financial advisors at Morgan Stanley have been requesting vital information from Twitter since May 9, this year, and severally since then, on the relationship between Twitter’s disclosed monetized daily active users (mDAU) figures and the prevalence of spam accounts on Twitter.
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Twitter Threatens Legal Actions
In response to Elon Musk’s termination of his agreement to buy 100% of Twitter, Twitter in its swift response has vowed to take legal action against Elon Musk, after claiming that Elon Musk’s claims were untrue.
In a statement by Twitter’s board chair Bret Taylor, “We are confident we will prevail in the Delaware Court of Chancery.”
According to the Twitter board, we are “committed to closing the transaction on the price and terms agreed upon with Mr. Musk and will seek legal action to conclude the transaction.”
Twitter also claimed that Mr. Musk will have to pay $1 billion to the company should Musk attempt to walk away from the deal as subject to the agreement, a claim Elon Musk believes not to be true.
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