Elon Musk Is Backing Out of the $44 Billion Deal to Buy Twitter

Elon Musk has officially filed a motion with the Securities and Exchange Commission (SEC) to terminate the $44 billion deal to buy Twitter. The corresponding letter was also sent to Twitter's chief legal officer on behalf of Musk, Reuters and CNBC report.

According to Musk's lawyer, the official reason for his refusal to buy Twitter was that Twitter failed to comply with its contractual obligations and did not provide relevant business information about the number of fake or spam accounts on the social media platform, which is critical to assessing the business potential of the purchase.

The entrepreneur previously said he was holding off on a deal to buy Twitter until the company could prove that spam bots and fake accounts represented no more than 5% of the social network's daily active users.

pic.twitter.com/JcLMee61wj
— Elon Musk (@elonmusk) July 11, 2022

Musk's specific complaint is reflected in his letter given to a Twitter representative:

"Twitter has failed or refused to provide this information. 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," the entrepreneur's lawyer said.

Elon Musk Acquires Twitter for $44 Billion

Shareholders will receive $54.2 for each common share, which is 38% more than their value as of April 1, when it became known that Musk had purchased a 9% stake in the company.

Recorded News — Tech NewsBradley Rhodes

Following the announcement, Twitter's board chair Bret Taylor said the company is still committed to closing the deal and will pursue legal action to enforce the agreement.

The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.
— Bret Taylor (@btaylor) July 8, 2022

Elon Musk announced his intention to buy Twitter at the end of April, acquiring a 9.2% stake in Twitter shortly before that. The billionaire said he was interested in buying Twitter because he believes in the company's potential as a platform where one can express freedom of speech around the world.