Dispute over takeover waiver: Twitter wants to sue Elon Musk

After Elon Musk’s withdrawal from the planned Twitter takeover, the short message service wants to sue the US billionaire and force the takeover at the price offered. Musk’s cancellation was “invalid and unlawful”.

The short message service Twitter is preparing for a legal dispute with US billionaire Elon Musk. It is about his attempt to call off the takeover of the online service. The Twitter lawyers wrote in a letter to Musk’s legal representative that his termination of the deal was “invalid and unlawful” from the company’s point of view. Contrary to Musk’s claims, Twitter did not violate the acquisition agreement, according to the letter published on Monday. Musk, on the other hand, knowingly and intentionally violated the agreement with his withdrawal. Twitter therefore now wants to go to court at the company’s official headquarters in the state of Delaware and force Musk to complete the purchase at the agreed price.

Musk announced on Friday that he was withdrawing from the agreement to buy Twitter for around $44 billion. To justify this, he referred to his previously unsubstantiated claims that Twitter had significantly more fake accounts than the company’s estimate of less than five percent. His lawyers argued, among other things, that Twitter failed to fulfill its contractual obligation to provide Musk with the necessary data access to verify the numbers.

Has Musk gambled?

Observers consider the reasons given by Musk to be unfounded. Rather, after the recent price losses of technology stocks, he may have come to the conclusion that he had to put too much money on the table for Twitter.

Twitter shares fell eight percent to $33.98 at the beginning of the week after Musk’s cancellation. The market capitalization was only a good 26 billion dollars. Musk and Twitter leadership agreed on a price of $54.20 per share towards the end of April. It was already announced in early April that Musk had become Twitter’s largest shareholder with a stake of 9.2 percent.