It could be one of the most unusual lawsuits in the history of takeover business: After Elon Musk bursts the hostile Twitter deal, the company is now sticking to the deal itself. Musk’s defense concept does not seem promising.
In a letter to Elon Musk, the short message service Twitter once again pushed for the takeover by the billionaire. Musk’s attempt to call off the $44 billion acquisition was “invalid and unlawful” and Twitter had not breached any of its obligations. In a letter dated July 10, Twitter’s attorneys state that Elon Musk’s efforts to exit the deal constitute a rejection of its obligations under the merger agreement.
The letter is in response to a letter from Musk’s lawyer on Friday, which accused the company of not providing the necessary data Musk needs to assess the proliferation of fake or spam accounts and said it means that Twitter has violated several terms of the agreement.
“Twitter has not breached any of its obligations under the Agreement, and Twitter has not, and is not likely to, suffered any material adverse impact on the Company,” Twitter’s attorneys wrote. They do not see the agreement as terminated and demanded that Musk honor his obligations. “As in the past, Twitter will continue to provide the information requested by Musk under the agreement and will diligently take all actions necessary to complete the transaction,” wrote William Savitt of Wachtell, Lipton, Rosen
Mike Ringler, an attorney for Musk at Skadden, Arps, Slate, Meagher
Ringler’s letter contained no evidence to support his claim that the estimate was inaccurate or an alternative calculation. Rather, Ringler wrote, “Musk has reason to believe” that the actual number of spam accounts is “substantially higher” than Twitter’s estimate.
Twitter’s response sets the stage for what could become one of the most unlikely court battles in takeover history: a scorned takeover target that never wanted to be bought may be trying to sell the buyer, who is now unwilling to go through with the deal, to force it to end.
