Twitter to sue Elon Musk for backing out of $44 billion buyout


Twitter is assembling a top legal team to sue Telsa CEO Elon Musk for ending his $44 billion deal to buy the platform, according to a report on Sunday.

Bloomberg News said the social media giant intended to file a lawsuit against Musk – who backed out of the planned takeover on Friday – earlier this week in Delaware, where the company is headquartered. .

Twitter has hired law firm Wachtell, Lipton, Rosen & Katz, known for its work in mergers.

If successful, the social media company could force Musk to pay a $1 billion severance fee, according to the report.

Musk backed out of the deal after Twitter failed to provide information about the fake accounts on the platform, according to court documents filed by his team.

His lawyers alleged in a court filing on Friday that “Twitter is in material breach of several provisions” of the takeover agreement, and that the company “appears to have made false and misleading statements that Mr. Musk relied on during of the conclusion of the merger agreement.”

The Tesla boss has retained Quinn Emanuel Urquhart & Sullivan, a high profile company he has worked with before, according to Bloomberg.

Elon Musk has ended his $44 billion deal to buy Twitter, saying the social media company failed to provide information about fake accounts on the platform.
Win McNamee/Getty Images
In an aerial view, a sign is displayed outside Twitter's headquarters on April 27, 2022 in San Francisco, California.
If successful, Twitter could force Musk to pay a $1 billion severance fee, according to the report.
Justin Sullivan/Getty Images

The case will likely go to chancery court, where a judge with expertise in business law will hear arguments without a jury.

The collapse of the deal came after a long saga. Following news in April that Musk secured a $44 billion deal to take over Twitter, he put the takeover on hold until the social media company proves the spam and bot accounts were less than 5% of users who see advertising on the site.

Insiders speculated that Musk reneged on the deal because he was now paying a massive premium for the company following the correction in tech stocks.

New York Post

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