Elon Musk is ‘TERMINATING’ his $44 billion Twitter takeoverv

Elon Musk could be trying to drive DOWN price of Twitter by terminating his $44B deal, expert says: ‘Twitter might be willing to settle for a small price reduction just to spare the time and expense’

  • In April 2022, Elon Musk first offered to purchase Twitter in a deal worth around $44 billion
  • Since then, Musk has stalled on the deal citing issues over the number of fake accounts on the platform
  • Two experts told DailyMail.com that Musk reneging on the deal could merely be a tactic
  • Musk cited material breach of multiple provisions of the agreement in a letter dropping the bombshell
  • Twitter’s chairman remains defiant saying that the company are confident that they can force the deal through
  • An anonymous Twitter employee said after news broke of the collapse that Musk had ‘f**king destroyed the company’
  • The news comes just days after Musk confirmed that he secretly fathered twins with Shivon Zilis

Two experts told DailyMail.com that Elon Musk’s decision to pull the plug on his proposed $44 billion acquisition of Twitter could merely be a tactic with a goal of getting a better price for the social media giant.


Musk accused Twitter bosses of refusing to hand over details about the number of spam bots on its site, in a letter announcing that he was reneging on the deal.

The billionaire blasted the social media giant for refusing to ‘comply with its contractual obligations’ throughout the acquisition process.

He also claimed the company had failed to operate normally over the past two months as it froze its hiring process and fired senior staff.

But Twitter immediately hit back, with its chairman revealing the firm planned to force through the blockbuster takeover through the courts.

Speaking to DailyMail.com, Ann Lipton, a professor of corporate governance at Tulane Law School, said: ‘At least based on public reporting, his position is quite weak, legally. But that doesn’t mean he can’t credibly threaten to create major litigation headaches for Twitter that could cause matters to drag on for years.’

Lipton continued: ‘What I can’t really figure out is his endgame; Twitter might be willing to settle for a small price reduction just to spare the time and expense, but it’s not obvious to me that’s what Musk wants.’

The professor added: ‘If he wants to walk away completely (possibly paying the break fee of $1 billion), or if he wants a much bigger price cut, that’s the kind of thing Twitter should be willing to dig its heels in over.’

Bret Taylor, Twitter’s chairman, tweeted the board was ‘committed to closing the transaction’ under the current terms of the deal and they were ‘confident’ they would win.

The bombshell update caused shockwaves across the business world, with the social media giant’s stocks sliding six per cent in extended trading.

It also came a day after Musk and Twitter CEO Parag Agrawal both appeared at ‘billionaire summer camp’ Sun Valley in Idaho – but it is not clear if they met.



Director of the Berkeley Center for Law and Business Adam Sterling, told DailyMail.com: ‘If this goes to the court of chancery and the court decides specific performance requiring Elon to purchase the company. If he flouts that, that’s pretty unprecedented. He’s shown willingness to things like that in the past.’

Experts speculated the move may have been a bid to drive the price down, with Musk offering $54.20 per share when it was at $36.81 on Friday night.

The Tesla founder is expected to speak at the exclusive festival on Saturday morning but he was yet to publicly comment on walking away from the deal.

In a letter to the Securities and Exchange Commission dropping the bombshell, Skadden Arps attorney Mike Ringler – acting for Musk – said Twitter were in material breach of multiple provisions of the agreement.

Ringler wrote: ‘Mr Musk is terminating the Merger Agreement because 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, and is likely to suffer a Company Material Adverse Effect.

‘While Section 6.4 of the Merger Agreement requires Twitter to provide Mr. Musk and his advisors all data and information that Mr. Musk requests ‘for any reasonable business purpose related to the consummation of the transaction,’ Twitter has not complied with its contractual obligations.

‘For nearly two months, 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’.

‘This information is fundamental to Twitter’s business and financial performance and is necessary to consummate the transactions contemplated by the Merger Agreement because it is needed to ensure Twitter’s satisfaction of the conditions to closing, to facilitate Mr Musk’s financing and financial planning for the transaction, and to engage in transition planning for the business.

‘Twitter has failed or refused to provide this information. Sometimes Twitter has ignored Mr Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr Musk incomplete or unusable information.’

Musk had previously threatened to halt the deal unless the firm showed proof spam and bot accounts were fewer than 5 per cent of users who see advertising on the social media service.

But Twitter immediately threatened to take legal action and said it was confident it would win.

Taylor tweeted: ‘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.

‘We are confident we will prevail in the Delaware Court of Chancery.’ That message was later retweeted by CEO Agrawal.

Adam Sterling told DailyMail.com: ‘The Delaware courts does a pretty good job of balancing shareholder and corporate interests.’

He added: ‘Twitter has constantly found itself in tough positions here. I think clearly with Elon attempting to terminate the deal they are obligated to pursue legal action against him based off of their fiduciary obligations to their shareholders. It’s all shocking but not surprising.’

In an internal memo, Twitter’s general counsel reportedly said: ‘Given this is an ongoing legal matter, you should refrain from Tweeting, Slacking, or sharing any commentary about the Merger Agreement.’

Speaking to NBC News about the collapsed deal, an anonymous Twitter employee said that Musk had ‘f**king destroyed the company.’

The employee said: ‘I guess it feels like we won. But it feels like the end of the movie, where the characters are bloodied and bedraggled with a Michael Bay explosion behind them. We could see this was coming, but in the meantime he’s f**king destroyed the company.’

During an all-hands meeting with employees in April, Agrawal attempted to quell employee anger after workers demanded answers to how managers planned to handle an anticipated mass exodus prompted by Musk.

Agrawal stood to make $42 million if the Musk deal went ahead.

Musk’s decision is likely to result in a protracted legal tussle between the billionaire and the 16-year-old San Francisco-based company.

Disputed mergers and acquisitions that land in Delaware courts more often than not end up with the companies re-negotiating deals or the acquirer paying the target a settlement to walk away, rather than a judge ordering that a transaction be completed.

That is because target companies are often keen to resolve the uncertainty around their future and move on.

Twitter, however, is hoping that court proceedings will start in a few weeks and be resolved in a few months, according to a person familiar with the matter.

There is plenty of precedent for a deal renegotiation. Several companies repriced agreed acquisitions when the COVID-19 pandemic broke out in 2020 and delivered a global economic shock.

In one instance, French retailer LVMH threatened to walk away from a deal with Tiffany & Co. The U.S. jewelry retailer agreed to lower the acquisition price by $425 million to $15.8 billion.

‘I’d say Twitter is well-positioned legally to argue that it provided him with all the necessary information and this is a pretext to looking for any excuse to get out of the deal,’ said Ann Lipton, associate dean for faculty research at Tulane Law School.

Shares of Twitter were down 6 per cent at $34.58 in extended trading. That is 36% below the $54.20 per share Musk agreed to buy Twitter for in April.

Twitter’s shares surged after Musk took a stake in the company in early April, shielding it from a deep stock market sell-off that slammed other social media platforms.

But after he agreed on April 25 to buy Twitter, the stock within a matter of days began to fall as investors speculated Musk might walk away from the deal. With its tumble after the bell on Friday, Twitter was trading at its lowest since March.

The announcement is another twist in a will-he-won’t-he saga after Musk clinched the deal to purchase Twitter in April but then put the buyout on hold until the social media company proved that spam bots account for less than 5 per cent of its total users.

The contract calls for Musk to pay Twitter a $1 billion break-up if he cannot complete the deal for reasons such as the acquisition financing falling through or regulators blocking the deal. The break-up fee would not be applicable, however, if Musk terminates the deal on his own.

Musk’s abandonment of the deal and Twitter’s promise to vigorously fight to complete it casts a pall of uncertainty over the company’s future and its stock price during a time when worries about rising interest rates and a potential recession have hammered Wall Street.

Shares of online advertising rivals Alphabet, Meta Platforms, Snap and Pinterest have seen their stocks tumble 45 per cent on average in 2022, while Twitter’s stock has declined just 15 per cent in that time, buoyed in recent months by the Musk deal.

Daniel Ives, an analyst at Wedbush, said Musk’s filing was bad news for Twitter.

‘This is a disaster scenario for Twitter and its Board as now the company will battle Musk in an elongated court battle to recoup the deal and/or the breakup fee of $1 billion at a minimum,’ he wrote in a note to clients.

Musk, 51, is slated to give the speech on Saturday at the Idaho stage referred to as the ‘billionaire summer camp,’ where the biggest names in tech and business come together to discuss the future of the industry.

It is not yet clear what Musk’s speech will entail, but the Tesla CEO is now set to close on his $44 billion Twitter takeover in October after a judge dismissed a lawsuit seeking to halt the deal.

Last month, Musk also threatened to back out of the deal if Twitter executives failed to provide data on spam and fake accounts that he has been seeking.

And back in April, during an all-hands meeting with employees, Agrawal was seen quelling employee anger after workers demanded answers to how managers planned to handle an anticipated mass exodus prompted by Musk.

The two are now set to once again come face to face at the Allen & Company Sun Valley Conference, where Agrawal, 38, has been attending private meetings for the past three days.

The annual invite-only, conference is hosted by the investment bank Allen & Company. This year, the five-day conference, running from July 6 to 10, is being held at the edge of Idaho’s Sawtooth National Forest in a tiny town of just 1,500 people.

The day before Musk’s bombshell, the Financial Times reported Agrawal was prepared to go to war to make the deal go through. The CEO was expected to make around $42million out of the deal.

The newspaper quoted a former Twitter executive as saying: ‘Parag wants to swing back more and is being more aggressive internally. It seems Twitter is willing to go to war to make this deal happen.’

The Financial Times also reported Agrawal and Musk have a good relationship and were in weekly contact.

In a call with executives Thursday, Twitter said it removes one million spam accounts each day during a briefing that aimed to shed more light on the company’s fake and bot accounts as it tussles with Musk over ‘spam bots.’

Musk has argued, without presenting evidence, that Twitter has significantly underestimated the number of these ‘spam bots’ – automated accounts that typically promote scams and misinformation – on its service.

Twitter said on the call that the spam accounts represent well below five percent of its active user base each quarter.

To calculate how many accounts are malicious spam, Twitter said it reviews ‘thousands of accounts’ sampled at random, using both public and private data such as IP addresses, phone numbers, geolocation and how the account behaves when it is active, to determine whether an account is real.

Private data, which isn’t available publicly and thus not in the data ‘firehose’ that was given to Musk, includes IP addresses, phone numbers and location. Twitter said such private data helps avoid misidentifying real accounts as spam.

Musk and Agrawal are now set to once again come face to face at the Allen & Company Sun Valley Conference, where Agrawal, 38, has been attending private meetings for the past three days.

The annual invite-only, conference is hosted by the investment bank Allen & Company.

This year, the five-day conference, running from July 6 to 10, is being held at the edge of Idaho’s Sawtooth National Forest in a tiny town of just 1,500 people.

Attendees of the conference include Bill Gates, Rupert Murdoch and Warren Buffet.

Last month, Twitter allowed Musk access to its ‘firehose’, a repository of raw data on hundreds of millions of daily tweets.

The Tesla founder’s team discovered that the number of fake accounts on the side was much higher than the 5% that was publicly disclosed, Musk said. In June, Twitter’s board voted unanimously to accept Musk’s offer.

Musk has not tweeted about the decision to pull the deal saying. In his last tweet which was on the day before the announcement the South African billionaire wrote: ‘Super fired up for future product development with our awesome Tesla team! Such an honor to work with them.’

The news comes days after Musk confirmed that he secretly fathered twins with his employee, Neuralink director of operations, Shivon Zilis.

In November, the Tesla CEO, 51, reportedly had twins with Shivon Zilis, 36, the director of operations at Musk’s brain-machine interface company Neuralink, Insider reported. He now has nine known children.

Musk and Zilis filed a petition in April to change the twins’ names in order to ‘have their father’s last name and contain their mother’s last name as part of their middle name,’ according to the court documents.

The twins were born in November, just weeks before Musk and Claire Boucher, the musician who performs as Grimes, had their second child via surrogate in December.

Zilis, who was born in Ontario, Canada, met Musk through OpenAI, the artificial-intelligence research-and-deployment nonprofit Musk cofounded in 2015, Insider reported.

She studied economics and philosophy at Yale where she also played goalie on the women’s ice-hockey team.

In 2015, Zilis was on Forbes’ 30 Under 30 list in the venture-capital category and in 2017, got the chance to use her AI expertise at Tesla.

Just last year, Zilis posted a nod to Prince Harry’s Silicon Valley startup with a throwback picture of the two of them from 2013 when she was asked to brief him on tech startups.

‘In 2013 I was asked to brief Prince Harry about tech startups,’ she tweeted. ‘Here I’m telling him how the Basis watch on my wrist came into existence through a crowdfunding campaign. At the time I wondered why he was interested in tech startups. 8 years later we finally know the answer!’

Zilis is currently the director of operations and special projects for Neuralink and has been floated as one of the people Musk could tap to run Twitter Inc after his $44 billion deal acquisition.

In 2020, Zilis posted a tweet defending Musk on his decision to move Tesla out of California over COVID-19 restrictions.

California State Assembly member, Lorena Gonzalez Fletcher, had tweeted ‘F**k Elon Musk.’

Zilis responded: ‘This makes me sad. No one’s perfect but I’ve never met anyone who goes through more personal pain to fight for an inspiring future for humanity – and has done so tirelessly for decades. Everyone’s entitled to their opinion but mine is that there’s no one I respect and admire more.’

The news of the twins’ arrival brings Musk’s total count of children to nine. Musk shares two children with Canadian singer Grimes, and other five kids with his ex-wife Canadian author Justine Wilson.

It’s the latest in Musk’s complicated personal life that includes three marriages and three divorces, including two of each with the same woman, and seven children from two long-term romances.

Musk and Grimes welcomed their second child Exa Dark Sideræl, who goes by Y, via surrogate in December. The billionaire said that he and Grimes were ‘semi-separated,’ according to a report by Page Six in September last year. They have another child named X Æ A-Xii.

In April, one of Musk’s children with first wife Justine Wilson filed court documents seeking to legally change from male to female and lose their last name, stating: ‘I no longer live with or wish to be related to my biological father in any way, shape or form.’

Xavier Musk, 18, filed the paperwork in Santa Monica, California, on April 18, seeking to be known as Vivian Jenna Wilson, taking the maiden name of her mother Justine Wilson, who was married to Musk from 2000 to 2008 and shares 18-year-old twins Xavier and Griffin and 16-year-old triplets Damian, Kai and Saxon.

The transgender teenager explained that they wish to take their mother’s last name to distance them from their dad but they have not commented on whether they receive financial support from their dad – whose $213 billion dollar fortune makes him the world’s richest man.

Musk has been vocal on various transgender issues and last year he complained about people using their own pronouns. He also said he was a fan of Florida governor Ron DeSantis who has been condemned by the LGBTQ community for his bill preventing discussion of gender identity and homosexuality in classrooms for children in kindergarten through third grade.

Elon and Justine Wilson, now 50, met while they were both attending Queen’s University in Ontario, Canada, and they tied the knot in 2000. The pair share five children but lost their firstborn, Nevada, in 2002 at just ten weeks old to Sudden Infant Death Syndrome (SIDS).

Following his split from Justine, Elon began dating British star Talulah Riley, who is most known for her roles in Pride & Prejudice, St. Trinian’s, Fritton’s Gold, The Boat That Rocked, Inception, Westworld, and Bloodshot.

Talulah first tied the knot with the Tesla architect in 2010. However, their first marriage ended in 2012, when she reportedly walked away with $16 million as part of a divorce settlement.




By the following summer, they had remarried. But then, in December 2014, she filed for divorce a second time, only to withdraw her lawsuit the following year.

In March 2016, Talulah requested a divorce a third time, and the pair split for good; the couple did not have any children together.

Elon then dated actress Amber Heard, 35, for several months in late 2016 and early 2017, after he reportedly pursued her for many years.

Amber’s ex-husband Johnny later accused Amber of cheating on him with Elon while they were still married, but both of Elon and Amber denied the affair.

They split in the summer of 2017, and afterwards, he told Rolling Stone in November 2017 that he was ‘really in love’ with Amber and that their breakup ‘hurt bad.’

Elon and Grimes began dating in April 2018, a month before they made their red carpet debut at the Met Gala.

A source told Page Six at the time that they met online ‘through a joke about artificial intelligence that Musk had planned to tweet, but discovered Grimes had already made.’

Rumors started to swirl that they had split by that fall, after the pair unfollowed each other on Twitter, however, Grimes insisted that they were still together during a March 2019 interview with Wall Street Journal.

Then, in January 2020, she announced that she was pregnant with their first child via Instagram, when she shared a pic of her baby bump, with no caption. They then welcomed their son in May of the same year.

After his birth, the couple was forced to change the spelling of their son’s name in order to comply with California law, which prohibits the use of any numbers of symbols in a name.

Instead of X Æ A-12, they revealed just a few weeks after the baby was born that his birth certificate would be registered under the name X AE A-Xii – using the Roman numeral version of the number ’12’ and changing the character æ to AE. They welcomed their second child Exa Dark Sideræl, who goes by Y, in December.




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