Twitter refuses to stay legal action, says Elon Musk

Elon Musk’s lawyers asked the court on Thursday, October 6, to end the legal proceedings brought against the boss of Tesla by Twitter to force him to buy the social network, ten days before the start of the trial. They argue that the multi-billionaire offered Monday to honor the takeover agreement signed at the end of April, and regret that Twitter “insists on continuing the procedure, endangering the transaction and playing with the interests of shareholders”, according to a legal document. consulted by AFP.

Elon Musk wrote to Twitter on Monday offering to buy the company as originally planned, for $44 billion, as long as he secured the necessary funds and the board dropped his lawsuits. The San Francisco-based company then took note and indicated that it still “intended” to complete the transaction. But the negotiations to conclude a new agreement seem to skate, in particular on the subject of the financing of the debt. Above all, after months of public attacks and about-faces from the boss of Tesla, the group with the blue bird is “wary”, noted Tuesday Adam Badawi, a professor of business law at the University of Berkeley. Twitter will demand “an armored contract this time. (…) They will want Musk to advance a good part of the total sum” before signing, he predicted.

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poker game

“Twitter refuses to end its lawsuits due to the theoretical possibility of a future failure to complete funding,” the Musk clan notes in its Thursday filing. But “this failure did not take place at this stage”, they underline. “On the contrary”, the creditors indicated “to be ready to honor their obligations”, say the lawyers. “Twitter’s groundless speculation has been refuted by the banks themselves.” Elon Musk had offered in the spring to acquire the platform for $54.20 a share, valuing it at $44 billion. The board of directors of the social network, initially very reluctant, had ended up accepting. But the whimsical entrepreneur unilaterally returned to this agreement in July, and Twitter had launched legal proceedings to force him to honor his commitment. Everything indicated that the platform was well positioned to win.

For Elon Musk’s lawyers, their client “agreed to do” what the company was asking. In Thursday’s document, they say they expect the deal to close “around October 28.” “And yet, Twitter refuses to accept this positive response. Incredibly, (the company) insists on continuing the procedure (…)”, they assert.

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The trial will be held on October 17

The trial is scheduled for October 17 in a specialized court in Delaware. “The parties have not asked for the proceedings to be suspended,” Judge Kathaleen McCormick said in a letter to lawyers on Wednesday. “I therefore continue the preparations for the trial,” she added. “Pursuing the process is not only a huge waste of the parties’ and the court’s resources, it will undermine the parties’ ability to close the deal,” Elon Musk’s lawyers say.

“At this point, there are two possibilities,” they argue. “The most likely thing is that the debt will be funded (…) and the shareholders will get their money much faster than if Twitter won the lawsuit, and won the appeal (…) a process that could take months”. The second outcome would be a funding failure, in which case “Twitter would have new elements to bring to its complaint”, argues the Musk clan. Twitter did not immediately respond to a request from AFP. “The (platform) board is playing a very high-stakes game of poker,” commented analyst Dan Ives of private investment firm Wedbush Securities.

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