Tesla Chief Executive Officer Elon Musk said on Friday he was terminating his $44 billion deal for Twitter Inc, citing material breach of multiple provisions of the agreement. He said that the social media company had failed to provide information about fake accounts on the platform.
The shares of Twitter were down 7% in extended trading. Musk had offered $54.20 per share in April. According to the filing, Musk’s lawyers said Twitter had failed or refused to respond to multiple requests for information on fake or spam accounts on the platform, which is fundamental to the company’s business performance.
They said in the filing, “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.”
On a certain level, Musk’s Twitter acquisition had always seemed more like a game than a real attempt to purchase and grow a business. Musk seemed to relish the ability to make wishful product plans about free speech and corporate independence more than he wanted to develop a coherent business plan for Twitter.
This decision is likely to result in a long protracted legal tussle between the billionaire and the 16-year-old San Francisco-based company.