Twitter Shareholders Approved $44 Billion Bid Despite Elon Musk Canceled
Twitter shareholders voted in favor of billionaire Elon Musk‘s $44 billion takeover proposal on September 13, despite Elon Musk’s July announcement of the deal’s cancellation. Currently, the two sides are still using legal actions to achieve their own purposes.
At the September 13 vote, the majority of shareholders accepted the price of $54.2 per share that Mr. Musk offered to buy back the entire social network. As of September 14, Twitter shares are trading around $41.74, about 30% below the offering.
Although the deal has achieved the necessary shareholder approval, billionaire Elon announced the cancellation of the agreement in July. The reason given by Musk is because Twitter provided false information about the user’s situation after announcing the suspension of the deal to verify the amount of bots and spam accounts on this social networking platform.
Shortly after, Twitter filed a lawsuit forcing Musk to abide by the signed agreement and compensate for the losses caused after repeatedly exposing the platform’s poor business practices.
According to documents filed with the US Securities and Exchange Commission (SEC) from April 26, either party will have to pay $1 billion in compensation if unilaterally terminating the contract. Therefore, this compensation provision will be activated if Musk does not pay as promised, or Twitter accepts an offer from another bidder, or shareholders vote to reject Musk’s offer. Even Twitter cannot call or negotiate with any other potential buyers after the deal, even if it is paid a higher price.
All will be heard on September 17 at the Delaware Chancery Court.
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