It has already become apparent: Tech billionaire Elon Musk is backing down on the Twitter purchase. The management of the company wants to take legal action against it – sooner rather than later. Experts consider Twitter’s legal position to be strong.
According to a media report, Twitter has already hired a law firm specializing in merger law to sue Elon Musk for withdrawing from the Twitter acquisition. Twitter plans to file the lawsuit earlier this week, Bloomberg reported, citing insiders. Twitter hired the law firm Wachtell, Lipton, Rosen & Katz. This also gives Twitter access to the lawyer Leo Strine, who has set milestones in similar cases. The lawsuit will be filed in Delaware.
Musk said on Friday after the US stock market closed that he would scrap the $44 billion Twitter takeover that had actually been agreed. Such a step had been speculated for weeks. Musk explained that Twitter had broken several points of the takeover agreement. The Twitter management immediately declared that they wanted to take legal action. Experts consider Twitter’s legal position to be strong, but do not rule out that the company could agree to a lower takeover price in renegotiations.
Musk announced in April that he wanted to take over Twitter for $44 billion. Recently, however, there was a dispute about the number of spam or fake accounts in the short message service. Twitter has repeatedly asserted that the number of such accounts is less than five percent. Musk and his team believe this information is incorrect. Most recently, observers had wondered whether Musk could really give up the purchase project – or just wanted to lower the price for a takeover.
Since April, Twitter shares have lost more than a quarter of their value. The shares of the electric car manufacturer Tesla, founded and managed by Musk, have lost almost a quarter of their value. Musk’s exit from the takeover project could now have legal and very expensive consequences. The agreement, reached in April, provides for compensation of up to $1 billion in certain circumstances if either party pulls out.
source: NTV