Tesla CEO Elon Musk has officially terminated his $44 billion takeover deal for social networking site Twitter over concerns about the number of fake users. Musk said on Friday that the decision was taken after Twitter failed to provide necessary information about the fake accounts. The takeover was dragging on for quite some time and after Musk expressed his concerns, the share prices went down almost 7 per cent in the past few weeks. According to the SEC filing, lawyers said that Twitter did not provide Musk with the necessary information despite multiple requests from their end.
“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,” the filing said according to Reuters.
According to experts, this can result into a long-drawn legal battle between Musk and Twitter as the terms of the deal stipulated a $1 billion break-up fee if he does not complete the transaction.
Earlier, Musk maintained that the deal is being delayed by concerns about the fake users. During his speech at the Qatar Economic Forum last month, he said that his team is working towards the deal.
“So, we are still awaiting resolution on that matter and that is a very significant matter,” he said.
However, the number of fake users ended up being the main point of concern between the two parties as Musk estimated the number to be around 20 per cent. Although Twitter said that it is not more than 5 per cent, the two parties were unable to find a middle ground.
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