Twitter plans to sue following Musk’s withdrawal from $44bn takeover
Twitter has announced it will sue Elon Musk if he refuses to go ahead with his $44bn takeover.
Chairman Bret Taylor said the company’s board was “committed to closing the transaction” agreed upon with the serial entrepreneur and it would plan “to pursue legal action to enforce the merger agreement.”
Under the agreement’s terms, Musk must pay $1bn to break off the contract.
The company has forbidden its staff from discussing the merger, sending a memo to employees.
Sent by Twitter’s general counsel Sean Edgett, the message asked to ““refrain from tweeting, slacking, or sharing any commentary about the merger agreement.”
Taylor’s remarks came after Musk yesterday wrote to the US Securities and Exchange Commission (SEC), saying he was pulling out of the deal.
Lawyers for Musk accused the social media platform of breaching the terms of the takeover agreement as well as making “false and misleading representations.”
“Sometimes Twitter has ignored Mr Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr Musk incomplete or unusable information,” read the statement filed to the SEC.
According to Musk, Twitter’s board failed to provide data that would enable him to “make an independent assessment of the prevalence of fake or spam accounts.
Commenting on the situation, some experts said the platform’s users would benefit from Musk pulling the plug on the deal.
“Keeping free speech out of the hands of billionaires can only be for the benefit of the general public,” Adam Leon Smith, of BCS, The Chartered Institute for IT told the PA news agency.
The Tesla chief executive, who is in the race to become the world’s first trillionaire, originally announced his intention to buy the platform in late April but after a few weeks he put the deal on hold, claiming he needed more information about the percentage of fake accounts on the platform.
In mid-June, the board unanimously recommended shareholders approve the deal following a meeting between Musk and Twitter employees when he reasserted his intention to move forward with the acquisition, City A.M. reported.