Elon Musk terminating $44 billion deal to buy Twitter

Posted By: Ashley Smith
July 8, 2022 @ 6:51 pm
Local News

Jonathan Newton/The Washington Post via Getty Images, FILE

(NEW YORK) — Elon Musk is terminating his $44 billion deal to buy Twitter, according to a new Securities and Exchange Commission filing.

“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’” and did not receive it, the filing stated.

Fake accounts have become a sticking point in Musk’s rollercoaster bid to acquire the social media platform, with the Tesla CEO previously threatening to end his agreement over concerns about the prevalence of bot and spam accounts.

In the filing on Friday, Musk’s attorney claimed that Twitter “is in material breach of multiple provisions of that agreement” and appears to have made “false and misleading representations” when entering into the agreement.

Twitter Chairman Bret Taylor responded Friday that the board is still committed to the terms of the 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,” he said on Twitter. “We are confident we will prevail in the Delaware Court of Chancery.”

Musk reached a deal to purchase the platform at $54.20 a share on April 25, after quickly becoming the largest shareholder of Twitter with a 9.2% stake.

On May 13, he said his plan to buy Twitter is “temporarily on hold,” citing concerns about spam accounts. He shortly clarified that he remained “committed to acquisition,” though the price of Twitter shares closed more than 9% down that same day.

Fake accounts make up less than 5% of users, Twitter stated in a public filing in May while noting that its estimation “may not accurately represent the actual number of such accounts, and the actual number of false or spam accounts could be higher than we have estimated.”

Musk, a prolific Twitter user with some 100 million followers, has yet to publicly comment on his plans to end his takeover.

If he walks away from the deal, Musk could be on the hook for a $1 billion breakup fee.

Twitter stock is down about 6% in after-hours trading on Friday.

ABC News’ Joshua Hoyos contributed to this report.

This is a developing story. Please check back for updates.