After a months-long public stalemate, Elon Musk is terminating his deal to take Twitter private, according to a securities filing posted today.
Twitter chairman Bret Taylor tweeted shortly after that the company’s board is committed to closing the $44 billion transaction and plans to pursue legal action to enforce the merger agreement.
“We are confident we will prevail in the Delaware Court of Chancery,” Taylor wrote.
Musk, via his lawyers, alleges the deal was made under false and misleading representation, largely because Twitter has not provided sufficient information about the prevalence of bot and spam accounts on its platform.
His legal team has been requesting information to ascertain the validity of the platform’s monetizable daily active users since May 9, according to the filing. Musk’s nearly two-month-long tussle with Twitter began shortly after it was announced he would acquire the company and become its interim CEO after the deal closed.
While Twitter in June agreed to allow Musk to access a “firehose” of data to settle the bot question, Musk’s filing claims there was not enough to assuage his legal team’s doubts.
If Twitter has more fake users than it says it does, it could undermine the utility of the platform for advertisers, currently its main form of revenue. However, Twitter is not a major channel for most media buyers, especially compared to titans like Meta and Google, though it has recently launched a strategy to woo performance marketers.
