Topline
Elon Musk and Twitter have reportedly agreed to postpone the Tesla CEO’s long-delayed deposition Thursday in the ongoing lawsuit between the two parties, as both sides try to close Musk’s $44 billion deal to acquire the social media company after his unexpected u-turn earlier this week.
Musk and Twitter have agreed to defer his deposition.
Key Facts
Musk’s team and Twitter agreed to defer the deposition as they attempt to reach a resolution on ending their high-profile lawsuit, Bloomberg reported, citing unnamed sources.
According to the Financial Times, Twitter is seeking “precise contractual protections” to ensure that Musk doesn’t back away from the deal once again, indicating the lack of trust between both sides.
Musk was scheduled to depose before Twitter’s lawyers in Austin, Texas, at 9.30 a.m. local time on Thursday after refusing to attend an earlier deposition on September 28 citing “Covid exposure risk” as one of the attorneys had recently been in brief contact with a person who tested positive for the virus.
According to the Wall Street Journal, the deal between both sides has still not been finalized as they argue over the terms of ending the ongoing lawsuit.
Twitter is unenthused about a condition placed by Musk’s representatives that the closing of the deal will be contingent on him receiving the required $13 billion debt financing—something Twitter fears Musk could deliberately sabotage—both the FT and Journal reports added.
Even as both sides continue to negotiate, Kathaleen McCormick, the Delaware Chancery Court judge hearing the case, is moving forward with preparations for the trial which is scheduled to begin on October 17.
News Peg
Before announcing his latest u-turn on the deal, Musk reportedly made a revised offer to acquire Twitter at a much lower price of $31 billion, the New York Times reported, citing four unnamed sources. This deal was quickly rebuffed by Twitter, according to the report, prompting Musk to raise his offer to around $39.6 billion—around 10% lower than the original $44 billion offer—and this also fell through. The lowball $31 billion offer may have allowed Musk to acquire the company without needing to secure the nearly $13 billion in debt financing from several major banks.
Key Background
Musk on Monday announced his latest u-turn in the ongoing months-long saga between him and Twitter, agreeing to follow through on his original $44 billion offer to acquire the company. In a filing with the Securities and Exchange Commission, Musk said he was willing to buy Twitter at $54.20 per share if Twitter immediately halted its ongoing lawsuit against him. After making an unsolicited offer to buy the company in April and take it private. Twitter agreed to move forward with the deal a few weeks later. A few months later, Musk announced he was terminating the deal as he accused Twitter of breaching parts of it by failing to provide him with adequate information about the number of bots or spam accounts on the platform. Musk’s actions triggered a lawsuit from Twitter to force the billionaire to go through with the acquisition. Musk’s recent u-turn was likely an acknowledgment that he was set to lose the court case.
Forbes Valuation
Forbes estimates Musk to be worth $232 billion, making him the world’s richest person by $78 billion.
Further Reading
Elon Musk’s deposition delayed as he wrangles with Twitter over deal (Financial Times)
Elon Musk and Twitter at Odds Over Terms of Agreement to Close Deal (Wall Street Journal)
Elon Musk Offered to Buy Twitter at a Lower Price in Recent Talks (New York Times)
Source: https://www.forbes.com/sites/siladityaray/2022/10/06/musk-and-twitter-reportedly-postpone-his-deposition-but-sticking-points-remain-in-44-billion-deal/