Twitter’s price rose as much as 3% on May 19 after company executives told employees that a $44 billion deal to sell the company to billionaire Elon Musk was still on track and that the agreed price of $54.20 per share. It cannot be renegotiated.
This is despite Musk’s recent tweets indicating that he put the acquisition on hold while assessing the number of bot accounts on the site.
According to Twitter, approximately 5% of his accounts are fake, while Musk estimates the percentage closer to 20%.
However, according to Bloomberg, Twitter’s chief lawyer, Vijaya Jade, told the task force during the meeting that “there is no such thing as a pending deal.”
Other top Twitter executives, including CEO Parag Agrawal and Chief Financial Officer Ned Segal, spoke to the staff as well.
After Twitter submitted its proxy statement to the Securities and Exchange Commission this week, which outlined the date and terms of the deal, the company-wide video call was designed for the leadership to discuss the acquisition and provide more details.
Executives have addressed several concerns about the deal, including whether Twitter will attempt to legally force Musk to buy the company based on his consent.
Gad reassured employees that Musk should “do everything in his power” to get his funding for the arrangement and that Twitter may try to “enforce” the terms of the arrangement if it is required to do so in court, but getting to that point would be “very rare.”
However, since Tesla’s market value has fallen by more than $400 billion due to the market downturn, Musk may want to lower the purchase price. He intends to use more than $10 billion of his Tesla shares as collateral to secure financing for the purchase of Twitter.
It should be understood that Musk would owe Twitter $1 billion in breakup costs if he pulled out of the deal, which would be difficult because he signed a contract.
Read also | Elon Musk Ready With $46.5 Billion To Buy Twitter, But Can He Really Buy It? Find out what’s coming
Tesla CEO may try to avoid paying severance fees by claiming that Twitter has more bots than previously reported.
But the microblogging platform appears to be adamant that Musk buys the company at the agreed-upon price.
While Twitter has remained committed to closing the deal, the stock market does not believe that will happen, due to the large difference between the agreed purchase price and the current price of Twitter’s stock.
The shares are down 30% on May 19 from the selling price of $54.20.
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