The deal between Elon Musk and social media giant Twitter is off - if Musk gets his way.
In a letter to Twitter's legal department late Friday, Musk sought to terminate the merger agreement between him and his financial backers and Twitter stating, "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 (as that term is defined in the Merger Agreement)."
The letter was also filed with the SEC.
The reversal of interest comes three months after Musk sought to buy the popular social media platform for $44 billion.
At issue is the number of spam or bot accounts on Twitter. Musk believes the platform is full of them and Twitter has insisted that his estimation is wrong. They eventually offered to let him look at their data, but Musk wanted an independent audit.
The letter adds that "Twitter has failed or refused to provide this information. Sometimes Twitter has ignored Mr. Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr. Musk incomplete or unusable information."
Musk had big plans for Twitter, including making it more of a public square, pushing through the editable tweets feature (which Twitter is already working on), and more open to unfettered speech from all sides. There was some concern he might invite Former President Donald Trump back onto Twitter (he was banned after the January 6th attacks), but that was never confirmed.
While Musk had previously put the deal on hold as he tried to gain further knowledge about the number of bots on the platform, he'd grown rather quiet about it in recent weeks and, notably, did not tweet about seeking to end the deal.
As for whether or not the deal is truly dead, that remains to be seen. Musk could be on the hook for millions and Twitter or shareholders, who would have approved the deal as soon as next month, seem prepared to sue Musk.
Twitter's Chairman Bret Taylor tweeted on Friday evening that the board will pursue "legal action to enforce the merger agreement."
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.July 8, 2022
Still, it seems unlikely Musk will entertain a new deal, at least not without a fight.
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