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regular-article-logo Monday, 07 October 2024

Twitter shareholders' nod to merger

Move hands over the deal’s outcome to a court battle with Elon Musk trying to scrap the purchase

Reuters Bangalore Published 15.09.22, 01:43 AM
Elon Musk

Elon Musk File picture

Twitter Inc’s shareholders approved a $44 billion buyout by Elon Musk on Tuesday, handing over the deal’s outcome to a court battle in which the billionaire is trying to scrap the purchase.

Shareholders were widely expected to vote in favour after a stock market downturn made Musk’s $54.20-per-share deal for Twitter, which was signed in April, look pricey in the current environment.

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Twitter shares are now hovering around $41 per share. Musk has informed Twitter he will not go ahead with the acquisition, arguing he was misled over the spam accounts on the platform and was not notified of a pay settlement the company reached with one of its top executives.

The two sides are scheduled to battle it out in court next month.

Twitter on Monday said payments to a whistleblower did not breach any terms of its sale to Musk, after the world’s richest man made another attempt to scrap the deal.

Twitter’s lawyers said Musk’s reasons for wanting to back out of the deal were “invalid and wrongful.”

Last week, lawyers for Musk said Twitter’s failure to seek his consent before paying $7.75 million to whistleblower Peiter Zatko and his lawyers violated the merger agreement with Musk, which restricts when Twitter could make such payments.

Zatko, who was fired by Twitter in January as the company’s security head, accused the social media firm last month of falsely claiming it had a solid security plan and making misleading statements about its defenses against hackers and spam accounts.

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