Twitter vows legal action after Musk cancels buyout deal

The Twitter board are adamant that the deal will go through.
Twitter vows legal action after Musk cancels buyout deal

According to an SEC filing on Friday, SpaceX and Tesla CEO Elon Musk has decided to pull the plug on the $44 billion deal to acquire Twitter.

Musk had offered to buy the microblogging platform back in April; however, the deal has finally collapsed after weeks of speculation.

“Mr. Musk is terminating the merger agreement because Twitter is in material breach of multiple provisions of that agreement”

stated the SEC filing by Musk’s lawyers.

Musk is one of the most popular influencers on the platform, with over 100 million followers. He had initially purchased a 9.2% stake via the open market, and the deal would have seen him acquire 100% of the company. 

Twitter’s board had unanimously accepted Musk’s offer of $54.20 per share in June. 

There were always looming concerns over Twitter’s spam data regarding automated bot activity. Musk had tweeted in May that the agreement was “temporarily on hold,” and his team had requested additional information from Twitter. 

Even though Twitter provided some data on the percentage of bots or automated accounts on the platform, there were questions about the company’s “own testing methodologies.

“For nearly two months, Mr. Musk has sought the data and information necessary to ‘make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform”

read the filing

“Twitter has failed or refused to provide this information”

Musk’s camp claims it’s a clear breach of agreement, so the deal cannot go through. 

In response to the announcement, Twitter’s chairman Bret Taylor tweeted that the company is exploring legal options to enforce the agreement. 

Musk is a known crypto aficionado, and some of his companies even accept cryptocurrency Doge as payment. He had proposed multiple changes for Twitter, including crypto payment integration and more freedom of speech. 

The deal’s collapse might be a setback for many Musk and Dogecoin supporters. Twitter’s stock shed 5% on Friday’s close. 

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James Satoshi
James Satoshi
James is a leader in Web3, NFTs, & DeFi with over 4 years of experience in the industry. You'll spot him covering all topics through-out Coinmash in our guides and analysis sections.