New York: twitter share Monday as Elon fell musk The social media giant issued a witty, defiant comment about an impending court battle after making a $44 billion buyout.
Shares of the microblogging platform closed 11.3 percent lower at $32.65, with analysts saying Musk’s exit puts the company in a vulnerable position at a challenging moment for its core business.
After weeks of threats, Musk pulled the plug on the deal on Friday, alleging Twitter “misleading” statements about the number of fictitious accounts, according to a letter from his attorneys included in the US securities filing.
In his first public remarks since the announcement, Musk took to Twitter late Sunday to troll the company, as he said he would sue to enforce the deal.
“They said I can’t buy Twitter. Then they won’t disclose bot information. Now they want to force me to buy Twitter in court. Now they have to disclose bot information in court,” he said with each Of the four statements written in the tweet, Musk was accompanied by pictures of him laughing with increasing glee.
A second tweet showed an image of martial arts star Chuck Norris behind a chess board, which Musk captioned, “Chuckmate.”
Twitter offered a new rebuttal of its own by issuing a letter from its legal team to Musk’s lawyers late Monday, which has accused the Tesla boss of grounds for ending the deal as “invalid and incorrect,” according to a securities filing. called upon.
“Twitter demands that Mr. Musk and the other Musk parties comply with their obligations under the Agreement, including their obligations to use their respective reasonable best efforts to carry out and give effect to the transactions contemplated by the Agreement, said Twitter attorneys at Wachtel, Lipton, Rosen and Katz.
The termination of the acquisition agreement struck in April set the stage for a potentially lengthy court battle with Twitter, which initially opposed a transaction with the unlikely billionaire entrepreneur.
The original merger agreement had a breakup fee of $1 billion.
Twitter has defended surveillance of its fake account and said it would sue Musk to force him to complete the deal.
The social network says the number of fake accounts is less than five percent, a figure challenged by multi-billionaires who believe the percentage is much higher.
S&P Global Ratings said Musk’s latest move carries “many downside risks” for Twitter, pointing to the uncertainty of the company’s revenue linked to advertising given the risk of a growing recession.
The rating agency said the successful recovery of the $1 billion breakup fee also had risks.
“While breakup fee credits may be positive, we believe negative publicity could harm Twitter’s relationships with its advertisers, employees and investors in all possible scenarios,” S&P said.
The latest after Musk escalated the issue of fake accounts to public skirmishes between back-and-forth-fried parties, with some analysts speculating that he was getting cold feet about the deal, which has fueled progressive advocacy about his political agenda. Criticism from groups. ,
Musk’s anti-normative conduct has come as little surprise to longtime watchers of the Tesla and SpaceX chief, who are accustomed to a constant stream of statements that violate or test tradition and sometimes lead to action from regulators. provoke.
Some market watchers predicted the deal would break out soon after it was announced, but others still saw the way forward on Monday in the wake of the latest developments.
“While both sides face a protracted battle with the final decision very uncertain, we believe Twitter may have a strong case,” said Morningstar analyst Ali Moghrabi.
“We also think that a scenario persists where Musk and Twitter reach a new, lower price agreement.”
But Mograbi lowered his estimate for Twitter shares to $47, from Musk’s bid price of $54.20, saying: “We expect Twitter to face the distractions it needs to increase revenue and expand margins.” Leave your efforts behind.”
For Dan Ives, analyst at Wedbush Securities, “it’s a ‘code red’ situation for Twitter and its board as the company will now go head-to-head against Musk in a Game of Thrones court battle.”
“We see that no other bidders are emerging at this time while the legal proceedings are going on in the courts.”
Briefing.com called the dissolution of the Musk deal “the worst-case scenario for the company in the short-to-intermediate term,” putting Twitter’s “future in the balance and creating a massive distraction.”