Home Ā» Twitter sues Musk to force him to comply with the $ 44 billion deal

Twitter sues Musk to force him to comply with the $ 44 billion deal

by admin
Twitter sues Musk to force him to comply with the $ 44 billion deal

Twitter sued Elon Musk in court. The objective of the social network is to oblige Tesla’s CEO to respect the purchase agreement of the social network found last April for a total amount of 44 billion dollars. The summons was filed, as anticipated by various US press sources in recent days, to the Delaware court which will have to determine whether the founder of Tesla remains committed to respecting the agreement signed for $ 54.2 per share or if Twitter has indeed violated its contractual obligations by not providing the entrepreneur’s staff with all the data necessary to understand the actual number of fake accounts on the platform.

The reasons for the clash between Twitter and Musk. The prosecution of the lawyers

There is open warfare on the subject of fake accounts. For Twitter they are 5% of the total number of accounts on the social network. For Musk and his lawyers many more. In recent weeks, the entrepreneur has repeatedly supported analyzes by researchers and data analysts who claim that fake accounts (or bots) are between 12 and 20% of those on the platform. Understanding their exact number is an essential metric to understand the true value of the social network, which can only be established based on the number of real existing accounts, the only ones that can be monetized for advertisers who currently represent 90% of the turnover. of the social network founded in 2006 by Jack Dorsey.

In a letter to Musk’s lawyers, the social media’s lawyers call the decision to break the agreement “invalid and wrong” and accuse Tesla’s number one to have “knowingly, intentionally, voluntarily and materially” broken the agreement. Musk’s choice to block the purchase coincided with the collapse of the stock market value of many technology companies (the entire Nasdaq is down by about 30% compared to April). And Tesla is included in the drop, main source of Musk’s wealth and main guarantee instrument put on the plate by the entrepreneur for the purchase of the social network. But it is not excluded that in the end the two sides can find an agreement. There is also a clause in the contract that allows Musk to withdraw against payment of a billion dollar penalty, under certain circumstances.

See also  Epidemics and pandemics: between knowledge and truth of medicine

The legal battle begins

If Musk really were to be able to free himself from the operation without paying duties, a rather delicate moment could begin for Twitter. The shares of the social network travel by about 40% under the $ 54.20 per share put on the table by the multibillionaire and in May the CEO Parag Agrawal made it known that the company has failed to achieve its financial and business goals.

Added to this is a difficult climate among employees, many of whom accuse the managers of the company of having faced this moment in a weak and ineffective way. Now the wait is for Musk’s response.

Tesla’s CEO could be called to a hearing before it really comes to trial. In the past, however, the Delaware Chancery Court has repeatedly prevented buyers from withdrawing and, if so, imposed damages. In any case, it will take months. The battle is only just beginning.

You may also like

Leave a Comment

This site uses Akismet to reduce spam. Learn how your comment data is processed.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More

Privacy & Cookies Policy