Twitter Shareholders Green Light Musk's $44 Bn Takeover Deal

With Elon Musk seeking to scrap the acquisition agreement, his team is prepping for a legal battle with Twitter in the Delaware Court of Chancery, Maryland, starting mid-October

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During a conference call at the company's San Francisco headquarters, Twitter shareholders on Tuesday approved a deal with Tesla chief Elon Musk to buy the company for a sum of $44 billion, according to reports.

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The world's richest person Musk wishes to scrap the deal and claims that the microblogging site has misled regulators about the number of bot accounts on it and failed to respond to his team's requests for clarification regarding the same, thereby violating the agreement between the two parties.

To legally back out of the deal, Musk's team must battle it out with Twitter in the Delaware Court of Chancery, Maryland, starting in mid-October. In a filing against Musk earlier this year, Twitter alleged, "Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he—unlike every other party subject to Delaware contract law—is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away."

"Musk refuses to honour his obligations to Twitter and its stockholders because the deal he signed no longer serves his personal interests," claimed the platform. Its shareholders' approval in Tuesday's preliminary vote can force Musk to deliver on his promise of acquisition. According to Twitter, it has shared with Musk a "firehose" of raw data on hundreds of millions of tweets, claiming that the number of fake profiles on the website account for less than five per cent of the total users.

The shareholders' vote follows whistleblower and former Twitter security head Peter Zatko's recent testimony in Washington before the US Senate Judiciary Committee, where he alleged security flaws at the platform's end. Musk has cited Zatko's testimony to bolster his case for terminating his deal with Twitter and buy more time to prepare for the Delaware trial, hoping to get the latter shifted to late November.