Twitter shares have taken a tumble in value after Elon Musk pulls out of his £36 billion buyout deal.
The social media giant took a tumble on the New York Stock Exchange after the Tesla founder and CEO withdrew his offer to purchase the microblogging site after months of stalling on the deal, which included a $1 billion break clause for the 50-year-old tech mogul.
Twitter - who plan to take legal action against the SpaceX founder for his refusal to honour the purchase after he cast doubts about the number of bot accounts on the site - were trading for $34.40 in the early hours of Monday morning (11.07.22), a little under the $54.40 they were going for prior Elon’s first attempted to purchase the site in April.
John Coffee, a law professor at Columbia University and former NYSE advisor explained that Elon - who has been antagonising Twitter on their own website with Chuck Norris memes- did not have “a great legal argument”.
He told BBC News: "It'll be a big battle, but I would predict it'll be quietly settled. I think Mr Musk doesn't expect to come out with a victory. I expect that he's hoping that he can knock another 10 or 20 billion off the price he agreed to pay."
When he first publicly declared his intention to purchase the site - which allows users to post 280 character messages to their followers - Elon said he longed to improve it by "defeating the spam bots, and authenticating all humans", which have plagued the website. However, he expressed hesitancy to proceed with the sale after he got into a dispute about the number of these accounts. The CEO Parag Agrawal assured him that they only made up five per cent of accounts despite Elon’s claims it was closer to 20 per cent.
Some in the field, such as Josh Wolfe, the co-founder of Lux Capital, have labelled the entire exercise a “clever rouse” to “sell and liquidate $8 billion of Tesla stock”.
