Elon Musk sent out a supplemental letter of deal termination to Twitter Inc, citing a recent whistleblower complaint from the social media firm’s former security chief as yet another reason to cancel the $44 billion deal.
Last week, Peiter Zatko, a well-known hacker known as “Mudge,” filed a complaint alleging that Twitter prioritized user growth over spam reduction and falsely claimed it had a solid security plan. more info
If the allegations are true, then Twitter has violated some of the terms of the merger agreement, according to Musk and his legal team in a letter dated Aug. 29.
Twitter, on the other hand, stated in a regulatory filing that the new termination notice was invalid and wrongful under the terms of the agreement.
Musk has also subpoenaed Zatko for information, primarily on how the microblogging site measures spam accounts. Musk terminated the agreement in July, claiming that the company misled him and regulators about the true number of spam or bot accounts on the microblogging platform.
According to a regulatory filing by Musk on Tuesday, his legal team stated that allegations on certain facts, which were known to Twitter prior to July 8 but were not disclosed to them, provide additional and distinct grounds to terminate the deal.
The latest development comes as the two parties prepare for a five-day trial at the Delaware Court of Chancery, which is set to begin on Oct. 17.
Twitter has asked Chancellor Kathaleen McCormick to order Musk to purchase the company for the agreed-upon price of $54.20 per share.
Before the bell, Twitter shares were down 2.5% to $39.02.
(Adapted from LiveMint.com)
Categories: Economy & Finance, Entrepreneurship, Geopolitics, Regulations & Legal, Strategy, Sustainability, Uncategorized
Leave a Reply