Fake account data raises doubts, Musk wants to terminate acquisition, Twitter board: taking legal action to complete the deal

Continuing from the previous reason for Musk pausing the acquisition of Twitter, which was the disagreement over fake account data, the situation seems to have further deteriorated. Musk has taken action to terminate the acquisition, while the Chairman of the Twitter board emphasizes the commitment to completing the transaction and expresses confidence in completing the acquisition through legal action.

Musk Terminates Deal

According to SEC documents, Musk stated in a letter to Twitter's General Counsel Vijaya Gadde that Twitter has violated multiple terms of the merger agreement by failing to provide relevant data related to the deal, as requested for legitimate business purposes, including an independent assessment of fake/junk accounts. Musk emphasized that this data is crucial for Twitter's future financials.

Despite Musk's ongoing pressure on Twitter since May 9, Twitter has failed to meet his demands over the past two months, thereby breaching sections 6.4 and 6.11 of the "Merger Agreement."

Board of Directors' Response

Twitter's Board Chairman, Bret Taylor, announced on Twitter on July 9 that they have received Musk's intention to terminate the deal. The board is committed to completing the transaction at the agreed-upon $44 billion and related terms as per Musk's agreement, and plans to take legal action to advance the deal, expressing confidence in their ability to prevail in court.

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