ELON Musk has terminated a $44billion agreement to purchase Twitter, alleging in a letter that the company “breached” the merger agreement.
The letter was sent on Friday, citing multiple discrepancies and a lack of information Musk required from Twitter to seal the deal.
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According to a letter from Musk, he claimed that Twitter is “in material breach of multiple provisions” of a previous letter of agreement.
Additionally, the letter states that Twitter “appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement.”
The letter goes on to state that Twitter has not complied with its previously stated contractual obligations.
Musk stated that Twitter failed to provide information regarding its spam and bot accounts, which was formally requested in a letter dating May 25.
“The May 25 Letter made clear that Mr Musk’s goal was to understand how many of Twitter’s claimed mDAUs were, in fact, fake or spam accounts,” the letter stated.
“Twitter has failed or refused to provide this information.”
“Mr Musk has reason to believe that the true number of false or spam accounts on Twitter’s platform is substantially higher than the amount of less than 5% represented by Twitter in its SEC filings.”
According to the termination letter, Musk sought this specific information three additional times, in letters dated June 6, 2022, June 17, 2022, and June 29, 2022.
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“For the past month, Mr. Musk has been clear that he views Twitter’s non-responsiveness as a material breach of the Merger Agreement giving him the right to terminate the Merger Agreement if uncured,” the letter goes on to state.
Additional information relating to the company’s financial situation was also not given to Musk, per the letter.
Twitter Chairman Bret Taylor published a tweet late Friday afternoon regarding the termination.
“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,” Taylor wrote.
“We are confident we will prevail in the Delaware Court of Chancery.”
Shares of Twitter fell by 6% Friday afternoon as news of the termination broke.
Musk was working to finalize a deal to buy Twitter on April 25 for $46.5billion.
The Tesla CEO had previously said: “A top priority I would have is eliminating the spam and spam bots and bot armies that are on Twitter.”
Musk has also said that Twitter needs to be taken private to grow and become a genuine platform for free speech.
On June 21, it was announced that Twitter’s board recommended unanimously that shareholders approve the proposed $44billion sale.
Musk made headlines earlier this week when it was revealed that he welcomed twins with Neuralink’s Shivon Zilis late last year.
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