US: Twitter has reportedly filed a lawsuit against Elon Musk for breaking the terms of the £36.5 billion deal to purchase the social media platform. According to a court filing the tech company has asked a Delaware court to mandate that the world's richest person complete the merger at the agreed-upon $54.20 per Twitter share.
The Tesla CEO terminated the acquisition in a letter to the board of the social media company, according to a statement released last Friday. He had previously agreed to purchase Twitter in April, but last week he said he intended to back out of the agreement.
Additionally, he claims that Twitter's dismissal of two top managers and the reduction of its talent acquisition team by a third violated the acquisition agreement.
Under these conditions, Twitter might have pushed for a $1 billion break-up fee. Instead, it appears to be prepared to engage in litigation over the transaction, despite board approval and CEO Parag Agrawal's insistence that he wants to close it. Twitter's board has filed a lawsuit in the Delaware Court of Chancery, according to the company's chair, Bret Taylor, in an effort to "hold Elon Musk accountable to his contractual obligations.
The majority of the drama has occurred on Twitter, where Musk, who has over 95 million followers, has complained that the service isn't doing enough to promote free speech. Friday saw a 5% decline in Twitter stock, dropping to 36.81 dollars from Musk's initial offer of 54.20 dollars.
Tesla's stock, meanwhile, increased 2.5% to $752.29 per share. Musk claimed in a letter to the Securities and Exchange Commission that Twitter "failed to comply with its contractual obligations" under the terms of the agreement, specifically by failing to provide him with enough data to "make an independent assessment of the prevalence of fake or spam accounts on Twitter's platform."
Musk, whose estimated net worth is £214 billion had pledged to keep Twitter a place for free speech.
He later added in a statement: "A healthy democracy depends on the right to free speech, and Twitter is the virtual town square where people debate issues that are important to the future of humanity.
"Additionally, I want to improve Twitter by adding new features, making the algorithms transparent to increase trust, eradicating spam bots, and authenticating every single user. Twitter has a lot of potential, and I'm excited to work with the business and the user base to realise it.
Musk also declared that after being banned from Twitter, he would reinstate Donald Trump's account.Musk previously threatened to scrap the entire agreement because he wanted more information on spam bots. The company has stated in regulatory filings for years that it thinks 5% of the platform's accounts are fake.
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