In a letter to the social media juggernaut last week, Elon Musk revealed the cancellation of a USD 44 billion plan to purchase Twitter.
Twitter shares experienced a dramatic decrease when Elon Musk announced his decision to cancel the USD 44 billion takeover agreement, paving the way for a court dispute. Shares are currently trading at USD 33.31 a share, significantly less than Musk’s offer of USD 54.20 per share, according to a report by The Hill using FactSet data that was published by The Wall Street Journal on Monday.
The price of Twitter shares has dropped since Musk first acquired a 9% stake in the firm in April. In addition, Tesla, owned by Musk, has seen a share price decline of 27% since Musk announced that he would purchase Twitter. This decline is greater than the S&P 500’s overall decline of 10% during the same time period. This development occurs as the social media company prepares to file a significant lawsuit against Elon Musk for pulling out of the takeover agreement. Tesla Inc. shares dropped close to 7%, while Twitter shares closed 11% lower at $32.65, wiping off approximately $3.2 billion in market value, according to a Bloomberg report.
It is noteworthy that Quinn Emanuel Urquhart & Sullivan is Musk’s legal counsel.
While on Saturday, Bret Taylor, Twitter’s chairman said, “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.”
In a letter written by Musk’s team to Twitter earlier on Saturday, Elon Musk said that the USD 44 billion deal to buy Twitter had been terminated. Due to many violations of the acquisition agreement, Musk made the decision to halt the transaction.
In an agreement worth about $44 billion, Musk and Twitter agreed to be acquired in April at a price of USD 54.20 per share. Musk, though, placed the agreement on hold in May so that his team could examine Twitter’s assertion that fewer than 5% of accounts on the platform are spam or bots.
Musk threatened to walk away from and cancel the acquisition of the social media firm for violating the merger agreement back in June after publicly accusing the microblogging website of not providing the data he has requested on spam and fake accounts.
