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TWTR.US
id: 336
On October 4, 2022, Elon Musk agreed to proceed with his $44 billion deal to buy Twitter (TWTR), Bloomberg reported, citing unnamed sources familiar with the matter. According to the Bloomberg article, the Legal team for Musk sensed the judge would not rule in his favor.
Going back, there was a long dispute process between Twitter and Musk in which the TWTR price has been extremely volatile, falling or rising sharply, significantly damaging both long and short holders and derivatives traders.
At the same time, without any materially significant new facts that could change the position of the parties, Musk decided to close the deal on the original terms, which gives rise to grounds to suspect him of either price manipulations or negligence in the course of M&A.
Chronology of all key events:
- On April 4, 2022, Elon Musk announced that he had acquired 9.2% of Twitter's stock although according to the SEC Rules disclosure must be made after overcoming the barrier of 5%.
- Musk agreed to buy Twitter in April for $54.20 per share, which works out to $44 billion.
- On April 25, 2022, Twitter's board of directors agreed to sell the company below its fair value after Elon Musk exerted public pressure.
- Musk has been trying to terminate the deal since July 8, claiming that Twitter wasn't providing enough information about the number of fake accounts bots it had on the platform.
- Twitter struck back against Musk in July, filing a lawsuit in Delaware Chancery Court with the hopes that Musk would be forced to buy the company.
- On August 23, 2022, CNN released an article “Ex-Twitter exec blows the whistle, alleging reckless and negligent cybersecurity policies” in which was disclosed that “Twitter has major security problems that pose a threat to its own users’ personal information, to company shareholders, to national security, and democracy".
- On August 29, 2022, Reuters reported that "Elon Musk has sent an additional letter of deal termination to Twitter Inc to include a recent whistleblower complaint from former security head of the social media firm as another reason to scrap the $44 billion deal.
- On September 13, 2022, Twitter (TWTR) shareholders voted to approve Elon Musk’s $44 billion bid to buy the Company.
Case Status
Attorney Investigation
Alleged Offence
Misleading Statements,
Price manipulation,
Insider Trading,
Malpractice,
Negligence,
Breach of Fiduciary duty,
Omissions
Suspected Party
Shareholder,
Influencer,
Investment Bank,
Service Provider
Security Type
Stocks
Trade Direction
Short
Shock Event Date
04 October 2022