Twitter is reportedly planning to sue Telsa CEO Elon Musk as soon as this week after he announced his desire to withdraw from the $44 billion deal to acquire the social media company on July 8.
However, it’s uncertain whether the billionaire would eventually purchase the platform, either at the previously agreed-upon price, at a renegotiated price, or not at all.
Twitter ‘committed to closing the transaction’ with Elon Musk
On April 25, the billionaire agreed to buy Twitter for $54.20 per share, but the platform’s share price has dropped 32.1 percent since then, to $36.81 per share at the time of writing.
According to a July 10 Bloomberg report, the company has hired the corporate law firm Wachtell, Lipton, Rosen & Katz and will file a lawsuit in the Delaware Court of Chancery, a non-jury trial court that hears cases involving corporations in the state of Delaware.
The board is “committed to closing the transaction” as originally agreed and prepared to take legal action “to enforce the merger agreement,” according to Twitter Chairman Bret Taylor’s commitment to take legal action against Musk for trying to back out of the deal.
What crypto Twitter thinks of Elon Musk bailing out
The crypto community on Twitter mostly disapproved of Musk’s decision to sell his ownership interest in the microblogging site, and supported his efforts to remove all spam and scam bot accounts.
📰BREAKING: @elonmusk is terminating his bid for @Twitter. Is this good or bad for our beloved #crypto Twitter?
— OKX (@okx) July 8, 2022
Others have expressed their desire for Musk to spend the money to “bail out the crypto industry instead” amid the prolonged crypto winter.
A potential tactic or a sudden blunder?
Some say Musk’s decision to abandon the agreement is simply a ploy to renegotiate the terms of the costly deal.
On July 10, Angelo Zino, an analyst with CFRA Research, told non-profit media company NPR that there was “no chance” the acquisition would be completed at the previously agreed-upon price of $54.20 per share.
On July 8, founder and CEO of Accelerate Financial Julian Klymochko tweeted to his 24,200 followers that a negotiated settlement is the “most likely outcome.”
The Tesla CEO also has a way out of the agreement, but doing so will result in a $1 billion “termination fee” that Musk must pay to Twitter, per the initial Securities and Exchange Commission filing on April 25.
The self-proclaimed Dogefather reacts
Musk reacted to the news with amusement on July 11, uploading a meme of himself implying that the lawsuit will force Twitter to divulge data about bot activities.
On Friday, Musk informed the Twitter board of his intention to terminate the $44 billion deal.
The letter stated that Musk is canceling the merger because Twitter “appears to have made false and misleading representations,” claiming that Twitter’s methodology for assessing spam and fake accounts, detecting and suspending such accounts was ambiguous.