Elon Musk Seeks To Back Out Of Buying Twitter

Call it the biggest deleted tweet of all time: Elon Musk now wants to back out of his agreement to buy Twitter.

Musk said Friday he was terminating his $44 billion offer for Twitter, citing “material breach of multiple provisions” of the agreement and alleging Twitter failed to respond to multiple requests for information on fake or spam accounts on the social media platform.

Bret Taylor, chair of Twitter’s board, said the 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.”

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.

— Bret Taylor (@btaylor) July 8, 2022

The Washington Post first reported in July that Musk’s team had stopped some discussions about funding for the deal, raising serious concerns about the data “fire hose” sent over from Twitter. Musk has been critical of Twitter and the prevalence of spam accounts on the social media site.

But Twitter’s share price has also plummeted since he first announced his takeover bid.

It’s unclear if Musk will be able to walk away over his concerns about spam accounts alone, and Musk could still be on the hook for $1 billion, even if he convinces a judge to let him back out of the deal.

Musk had plenty of reasons to get cold feet, one of which was the incidental damage his ownership risked inflicting on his other businesses.

Owning and operating Twitter comes with unavoidable controversy, and the spillover to Tesla, whose stock fell roughly 20% soon after Musk forced the Twitter sale, presumably wasn’t worth the risk.