Elon Musk to pay $1 billion as Twitter deal termination fee
Elon Musk has ended the Twitter buyout saga by cancelling the deal, citing the microblogging platform’s breach of multiple provisions. Elon Musk will now have to pay a whopping $1 billion as a deal termination fee as per the filing with the US Securities and Exchange Commission (SEC).
“Musk will be required to pay Twitter a termination fee of $1 billion if he cancels the deal,” according to an SEC filing.
On Saturday, Elon Musk notified Twitter via a letter about his move to back out of the “merger agreement” of his $44 billion deal in April this year.
“Musk is terminating the merger agreement because Twitter is in material breach of multiple provisions of that agreement, appears to have made false and misleading representations upon which Musk relied when entering into the merger agreement, and is likely to suffer a Company Material Adverse Effect,” stated the filing.
Meanwhile, Twitter’s board chairman Bret Taylor remains hopeful of closing the deal at the agreed-upon price.
“The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery,” Taylor tweeted.
Musk had last month threatened to cancel the deal accusing the social media platform of refusing to share information about its spam bot and fake accounts.