Musk wants to terminate the acquisition of Twitter, analyzes the price of the transaction between the two parties or re -negotiation

Jimu Journalist Zeng Lingzheng

On July 8th local time, a letter sent by Lawyer Musk to Twitter showed that Musk's plan to terminate the acquisition of Twitter was because Twitter disclosed false information on the issue of false accounts and spam. In response, Bret Taylor, chairman of Twitter Board, responded on Twitter that Twitter still hopes that the acquisition price that has been determined earlier will reach a transaction, and Twitter Twitter will resort to court on the termination of Musk's acquisition of Twitter. Many lawyers analyzed that compared with the long -lasting lawsuit, the two parties are more likely to negotiate the acquisition price in the future to complete the transaction.

The letter sent by the Musk Agent Lawyer to Twitter (picture source: official website of the US Securities Regulatory Commission)

In this letter, Musk's acting lawyer said that Musk had repeatedly requested to provide false and spam accounts to Twitter, and the relationship between these accounts and MDAUs (the number of realization users). The purpose is to allow Musk and his consultants to independently evaluate the general degree of the existence of false accounts and spam accounts on Twitter. But Twitter failed to provide a lot of data and information to respond.

The chairman of the Twitter Board responded to "court opinion" (Screenshot of Twitter)

In response, Bret Taylor, chairman of Twitter Board, said on Twitter that the Board of Directors promised to complete the transaction in accordance with the price and terms agreed with Musk, and plans to take legal actions to implement the acquisition agreement. "We are confident to win in the Hengping County Court of Traveling."

On April 25, 2022, Musk reached an agreement with Twitter, which will acquire Twitter for $ 54.2/share and a total price of 44 billion US dollars. However, 3 days later, Twitter announced the financial report in the first quarter of this year. The financial report shows that the MDAU (the number of realization users) in the first quarter reached 220.9 billion, an increase of 15.9%year -on -year. After the internal review of the company, the proportion of false accounts is expected to account for less than 5%of the overall MDAU.

However, Musk did not agree with this data. He believed that Twitter underestimated the proportion of false accounts and said on May 25 that Twitter refused to explain how to calculate the proportion of false accounts. "This is very suspicious. ","

In the letter issued by an agent lawyer, Musk's attention is still concentrated in the number of false and spam accounts, saying that it may be "major adverse effects" and therefore intends to terminate the acquisition.

On July 9, a number of corporate lawyers analyzed to Reuters that after the two parties in the future, Twitter will occupy the legal advantage. Because the court set a high threshold for allowing acquirers to abandon the transaction. Target companies often re -negotiate in transaction negotiations in a lower price or financial compensation, rather than a chaotic court dispute that may last for months.

In the past cases, only once caused by "major adverse effects". That is, in 2018, the German Medical Health Care Group Fisenmus Carbi has terminated a transaction with US non -patented drug manufacturer Akorninc.. In this case, the court ruled that Akorn concealed the facts about the deterioration of the performance in the allegations.

"Tulane Law School) Ann Lipton, deputy dean of Tulane Law School, said:" If Twitter and Musk are in charge of the book, Musk not only has the responsibility to prove that Twitter's data is false, but also fakes. The degree is enough to have a profound impact on Twitter's future income. "

On July 8th, Twitter's stock price fell 5%(source: Tencent's own stock selection)

In fact, after the letter sent by lawyer Musk to Twitter on July 8, Twitter's stock price had fallen by 5%to $ 36.81/share, far lower than the previous purchase price of Musk's $ 54.2/share.

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