Tesla and SpaceX CEO Elon Musk has withdrawn his $44 billion offer to buy Twitter, according to a filing with the Securities and Exchange Commission.
Musk offered to buy the social media platform in April, however his comments since have triggered ample “will he or won’t he” speculation about his looming purchase. And today, we finally know for sure: he won’t.
Musk’s lawyers alerted the firm that he will terminate the merger agreement that would have seen Musk buy out all remaining shares and fully own the platform.
“Mr. Musk is terminating the merger agreement because Twitter is in material breach of multiple provisions of that agreement, appears to have made false and misleading representations upon which Mr. Musk relied when entering into the merger agreement, and is likely to suffer a company material adverse effect,” reads an SEC filing from Musk’s attorneys.
Musk had previously acquired a 9.2% stake in the social media platform, where he has 100 million followers. He offered $54.20 per share to acquire the rest of the firm, and Twitter’s board unanimously recommended accepting the deal in June.
However, it increasingly appeared that Musk was looking to back out of the deal. He had previously cited concerns over spam and the activity of automated bots on the platform, suggesting that Twitter was not providing requested information.
“For nearly two months, Mr. Musk has sought the data and information necessary to ‘make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform,’” reads the SEC filing. “Twitter has failed or refused to provide this information.”
"Twitter's latest offer to simply provide additional details regarding the company's own testing methodologies, whether through written materials or verbal explanations, is tantamount to refusing Mr. Musk's data requests," read the letter from Musk’s attorneys.
His team claimed that it was a “clear legal breach” of the terms of the agreement, and that Musk may seek to exit the deal.
In response to the news, Twitter chairman Bret Taylor tweeted: "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."
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
Musk is a Dogecoin aficionado whose tweets about the meme coin have frequently sent its price rising or falling. He shared a number of planned changes for Twitter following the acquisition, including integration of Dogecoin for payments, opening up the platform’s source code, and providing less restrictive oversight to content.
Twitter’s stock price closed the day down 5% at just under $37, but has fallen further in after-hours trading to a current price of about $34 per share.
Editor's note: This story was updated after publication to include the details of Musk's filing with the SEC.