Elon Musk has backed out of a $44bn (£36.5bn) deal to buy Twitter.

In a statement filed with the US Securities and Exchange Commission, representatives for the Mr. Musk said Twitter violated the terms of the agreement and “appears to have made false and misleading statements.”

They said Twitter also failed to provide data and information requested by Mr Musk so he could “make an independent assessment of the prevalence of fake or spam accounts” on the social media platform.

“Twitter sometimes ignored Mr. Musk’s requests, sometimes denied them for what appeared to be unreasonable reasons, and sometimes claimed to be compliant by providing Mr. Musk with incomplete or inappropriate information,” the statement said.

Mr. Musk’s decision sent Twitter shares down 7% in after-hours trading, well below its lows $54.20, which he offered to pay for the campaign back in April.

The terms of the deal require Mr Musk to pay a $1bn (£830m) breakup fee if he does not complete the deal.

However, it appears Twitter’s board has no plans to accept the payment and will instead take legal action.

Twitter is confident it can take legal action

Twitter Chairman Brett Taylor tweeted that the company “is committed to closing the transaction at the price and terms agreed upon with Mr. Musk and plans to file a lawsuit to enforce the merger agreement.”

“We are confident that we will prevail in the Delaware Court of Chancery,” he added.

The possible collapse of the agreement is just the latest twist in the saga between the world’s richest man and one of the most influential social networks.

Much of the drama played out on Twitter, when Mr. Musk, who has more than 95 million followers, complained that the company was failing to live up to its potential as a platform for free speech.

Musk put the deal on hold

Tesla’s chief executive had previously threatened to end the deal unless the company could prove that spam and bot accounts accounted for less than 5% of users seeing ads on its service.

Last month, Twitter gave Mr. Musk access to its “firehose,” which is a repository of raw data on hundreds of millions of daily tweets.

Read more:
Twitter to provide raw daily tweet data to Musk ‘amid concern over fake accounts’
Musk says he would reverse Trump’s ban on Twitter if he took over the social network

Mr. Musk’s flirtation with buying Twitter began in late March, when Twitter said he had contacted board members, including co-founder Jack Dorsey, and told them he was buying shares in the company and was interested in joining the board. directors or take Twitter. private or beginning competitor.

He later revealed in a regulatory filing that he had become the company’s largest shareholder after acquiring a 9% stake worth about $3 billion.

Initially, Twitter offered Mr. Musk a seat on the board of directors.

But six days later, Twitter’s chief executive tweeted that Mr Musk would not join the board after all, and his bid to buy the company went ahead soon afterwards.

“This is a disaster scenario for Twitter”

Inside Twitter, Mr. Musk’s proposal was met with confusion and a drop in morale, especially after he publicly criticized one of Twitter’s top lawyers involved in content moderation decisions.

After the deal, the company froze hiring, halted discretionary spending and fired two top executives.

Musk’s decision is likely to lead to a lengthy legal battle between the billionaire and the 16-year-old San Francisco-based company.

Daniel Ives, an analyst at Wedbush, said this is bad news for Twitter.

“This is a disastrous scenario for Twitter and its board, as the company will now face Musk in a protracted legal battle to recoup the deal and/or a breakup fee of at least $1 billion,” he said.

https://news.sky.com/story/elon-musk-pulls-plug-on-44bn-deal-to-take-over-twitter-12648536

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