Elon Musk withdraws from $44 billion Twitter deal

July 8 (Reuters) – Elon Musk, CEO of Tesla Inc (TSLA.O) The world’s richest person, said on Friday that he had completed his $44 billion deal to buy Twitter (TWTR.N) Because the social media company failed to provide information about the fake accounts.

Twitter shares are down 7% in extended trading. Musk offered $54.20 per share in April.

Twitter CEO Brett Taylor said on the micro-blogging platform that the board intends to pursue legal action to enforce the merger agreement.

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“The Twitter Board is committed to closing the deal at the price and terms agreed with Mr. Musk…” he wrote.

In a filing, Musk’s lawyers said Twitter failed or refused to respond to multiple requests for information about fake or spam accounts on the platform, which is essential to the company’s business performance.

“Twitter is in material breach of several provisions of this Agreement and appears to have made false and misleading representations on which Mr. Musk relied upon entering into the Merger Agreement,” the filing reads.

The announcement is another twist in the will-he-won’t-he saga after the world’s richest person reached a $44 billion deal for Twitter in April, but halted the acquisition until the social media company proved the account of spam bots was lower. of 5% of its total users.

The terms of the deal require Musk to pay a $1 billion breakup fee if he doesn’t complete the deal.

Musk threatened to block the deal unless the company showed evidence that spam and bot accounts were less than 5% of users viewing ads on the social media service.

The decision is likely to lead to a protracted legal struggle between the billionaire and the 16-year-old company, based in San Francisco.

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(Reporting by Greg Romelutis) Additional reporting by Shafi Mehta in Bengaluru. Editing by Sriraj Kalovila, Anna Driver and Lisa Schumaker

Our criteria: Thomson Reuters Trust Principles.

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