Twitter board chairman Bret Taylor says it plans to pursue legal action to enforce the deal and is committed to closing it on the price and terms agreed upon
Elon Musk is bailing on his $44 billion agreement to buy Twitter, claiming that the social media company hasn't met its contractual obligations …
Axios
Context & Ripple Effects
Twitter had already said in May that it intended to close the transaction and enforce the merger agreement, while a shareholder later alleged that Musk had acted to create doubt about the deal. The board’s statement turns that earlier commitment to enforce the agreement into a direct response to Musk’s attempted exit.
Twitter’s board commits the company to seek enforcement of the agreed acquisition terms rather than accept Musk’s termination claim.
Musk faces a company-backed legal challenge to his assertion that Twitter failed to meet its contractual obligations.
Second-order effects
The enforcement posture gives Twitter shareholders a clearer company position amid the separate shareholder lawsuit over the deal’s handling, concentrating scrutiny on whether the transaction terms will be honored.
The parties’ disagreement shifts the acquisition from negotiation over alleged breaches toward a legal determination of the merger agreement’s obligations.
Third-order effects
If enforcement rather than repricing becomes the response to contested takeovers, signed acquisition agreements carry greater practical weight when buyers seek to exit after announcement.
The trend: The episode is part of a shift in contested public-company takeovers from public disputes over deal rationale to litigation over whether signed terms can be enforced.
OK, Twitter/Musk/Chancery court funtime initial impressions. Musk's termination letter primarily relies on Section 6.4 of the Merger Agreement. That's below. But that provision has holes the size of a montreal bagel. Look at the part right after the page break. 1/ https://twitter…
The board has 16 billion reasons the deal goes through. Elon has 16 billion reasons to not do the deal. FYI; Twitter closing market cap today was a shade north of $28billion. https://twitter.com/...
@Techmeme Twitter tanking would be far worse than Google pulling the plug on Google Reader in 2013. The whole world is in a way built around Twitter, and it works pretty well.
I imagine the Delaware Court of Chancery as a kind of medieval faire, all the staffers dressed as buxom wenches and burly woodcutter peasants, there's a dude playing lute, plaintiffs seeking satisfaction must joust, etc
I really do think this is the worst possible scenario for Twitter. Either: A) Twitter forces Elon to buy a company he doesn't want with employees who seem to mostly feel the same B) Elon walks and Twitter, fresh off cost cuts and layoffs, watches stock fall wayyy below $54.20
The two can be: - both parties to a contract - one party to a contract alleging breach and a judge who agrees in either case the lawyers get paid, of course