Elon Musk Is Twitter’s Material Adverse Effect
Elon Musk wants to leave Twitter at the altar, having mistaken lust for love. Walking away will still cost him, but it is a better outcome for both sides. The question for Twitter’s shareholders is how much worse off it will be than before its brief dalliance with the famous billionaire.
In a filing Friday, Mr. Musk’s lawyers declared his intention to terminate the merger agreement he signed in April with the social-media platform. His claim is that Twitter breached their deal by failing to provide Mr. Musk with requested information to settle questions about bots and an allegedly inflated user count. Mr. Musk, through his lawyer, is also accusing the social network of “materially inaccurate representations,” and added for good measure his belief that the portion of spam and fake accounts in Twitter’s user base is “wildly higher” than the less-than-5% figure Twitter has historically claimed in its regulatory filings.