The wealthiest man on earth has managed to put himself into the spotlight again. Twitter has officially brought a lawsuit against Musk in a Delaware court after Musk terminated his offer due to concerns of misrepresentation of bots on the site. Musk had no problem poking fun at the situation on the very site that’s suing him for the $44 billion they expected to get paid.
— Elon Musk (@elonmusk) July 11, 2022
In the filing to the SEC this past Friday, Elon’s litigation team claimed that “Twitter is in material breach of multiple provisions.” Bret Taylor, the chairman of Twitter, fired back at the claims by asserting he was “confident we will prevail in the Delaware Court of Chancery.”
The proposed offer to buy Twitter outright stood at $44 billion, but recent macroeconomic events, and uncertainty surrounding the outcome of the merger has put the company value at around $26 billion. This deeply discounted value indicates the uncertainty surrounding the economic outlook, as well as the protracted legal battle that could take place in the months and perhaps even years ahead.
Both sides of this lawsuit have all-star litigation, but the determining factor of who gets the upper hand will be determined by which party struggles more with the uncertainty. It remains a possibility that Elon will have to sell more Tesla stock to cover the purchase of Twitter. However, Twitter will have to continue executing operations in the months and years ahead while trying to stave off a hostile takeover from the world’s richest man.