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Shares in Twitter dropped After Musk Says He’s Ending Acquisition Bid

Shares in Twitter dropped on Monday after Elon Musk reported taking out his $44bn (£36bn) deal to buy the social media platform.

Techestudio Editors 3 months ago 0 20

Shares in Twitter dropped on Monday after Elon Musk reported taking out his  $44bn (£36bn) deal to buy the social media platform. Twitter is one of the most known social media platforms that is used by many high profiles; that is enough to make this platform highly in demand, but its popularity increased when Mr. Musk announced that he was going to buy this platform, and this news spread like a fire in all over the world. Everyone was talking about the deal Mr. Musk and Twitter agreed on, which is $44bn; that’s huge. Many critics and social analysts give their verdict on this decision; some showed high gratitude towards this, or some were unhappy with this deal. Many critics said that this deal would not be going to last longer. But Mr. Musk put some conditions before the agreement and really wants to make Twitter a transparent platform for everyone where everyone has equal rights to speak without being blocked or judged, and he wants to make this platform a bot free to make it more authentic.

But as per the recent reports, Mr. Elon Musk announced that he is canceling the deal and pulling out his share of  $44bn. That news impacted Twitter, and they plan to take legal action against Mr. Musk to make this deal successful by hiring a top US law firm. But it seems like Mr. Musk has already made up his mind as he took to his social media and commented on the legal action reports by saying “Disclose bot info” in the count. As Mr. Elon claimed that Twitter failed to provide authentically and enough information about the number of spam or fake accounts they have as per my conditions.  

Investors reacted to the recent announcements of the very famous Elon, who is also the owner of the electric car firm “Tesla.” People were already shocked by the extensive amount of deal he agreed on, and now this news has devastated many investors as well. It affects the Twitter share rate as Twitter’s share price stood at about $32.64 as Monday trading closed.

The conflict that happened on the fake number of accounts on Twitter is entertaining; as Elon musk wanted to make this platform bot accessible and authentic, he put a condition to have a detailed report on all the fake number of accounts on Twitter. And that’s the reason stated as per the reports of the cancellation of this agreement.

The original agreement includes a $1bn fee in case of any party refuse or breaks the deal. In this case, Mr. Elon should be applied with these charges, but instead, the Twitter chairman still wants to make this deal work; as Bret Taylor said in a recent tweet, “The Twitter board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk.”

Twitter has also hired top corporate law firms to handle this case; they are New York’s Wachtell Lipton Rosen & Katz, who are known to be the world’s leading law firms. It is also reported that John Coffee, a former advisor of New york’s stock exchange and a Law school professor at Columbia, told the BBC in a recent interview that Mr. Musk didn’t have a “great legal argument.” He also said, “It’ll be a big battle, but I predict it’ll be quietly settled.” As per  John coffee’s assumption that Mr. Elon is just trying to decrease the real deal and wants to knock 10 or 20 billion off the price.

 As Mr. Musk sold roughly $8.5bn (£6.8bn) worth of stakes in Tesla, that affected Tesla to raise the finance to make the deal successful. Some litigators like Ann said in this matter that Mr. Musk “kind of got cold feet” because he came to know that he is affecting his own company. This decision is dropping the price of Tesla stock. She also said that merger agreements are hard to close, so it will be difficult for Mr. Elon to get out of it easily.

As Mr. Elon presented, the reason is Twitter’s false representation of fake accounts. The decision is not acceptable. It clearly shows that Mr. Elon understood that he was too fast to take this decision, and now he regrets it.

On the other hand, Twitter still wants to make this deal successful and doesn’t want to drop its shares in the market by neglecting the world’s richest man. None of the parties wants to pay the termination fee either.

Now the chances are circulated that Mr. Elon will have a revised or counter offer from Twitter. But for now, no one knows what will be the final turnaround of this complete conflict between the two parties. Let’s see what will be the future of Twitter is going to be.

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