November 26, 2022

Solid State Lighting Design

Find latest world news and headlines today based on politics, crime, entertainment, sports, lifestyle, technology and many more

Source says Musk and Twitter may reach an agreement to end a court battle, and close a buyout soon

Source says Musk and Twitter may reach an agreement to end a court battle, and close a buyout soon

WILmington, Dell, Oct 5 (Reuters) – Elon Musk and Twitter Inc (TWTR.N) A source familiar with the matter told Reuters that he may reach an agreement to end litigation in the coming days, paving the way for the world’s richest person to close his $44 billion deal for the social media company.

Musk, who is also the CEO of electric car maker Tesla Inc. (TSLA.O)suggested on Twitter late Monday that he would change tack and stick to his April agreement to buy the company for $54.20 per share, if Twitter drops litigation against him.

The source said the two sides were expected to reach an agreement as early as Wednesday, but negotiations are continuing with a decision expected to take more time.

Register now to get free unlimited access to Reuters.com

However, Twitter’s legal team has not yet accepted the agreement, and Chancellor Kathleen McCormick, Delaware District Court Judge, said she is preparing for the impending trial.

“Neither parties have made a condition to stop this proceeding, and neither party has come forward to stop it. Therefore, I continue to press for the start of the trial scheduled to begin on October 17, 2022,” McCormick wrote in court Wednesday. Deposit.

Musk’s proposal on Monday included a condition that closing the deal would be pending receipt of debt financing. The source, who asked not to be named, said the potential agreement would likely remove this requirement.

Twitter’s legal team and Musk’s attorneys briefed the judge on Tuesday about their attempts to overcome mutual distrust and find a process to complete the deal.

See also  US agency upgrades Tesla's autopilot safety probe, a step before a possible recall

Two companies partially interested in financing the deal, Apollo Global Management, Inc (APO.N) Two sources told Reuters that and Sixth Street Partners have ended talks to offer up to $1 billion combined.

An attorney representing a proposed class action against Musk on behalf of Twitter shareholders said in a letter to McCormick that Musk should be required to “deposit a significant amount” if he again abandons his shutdown commitment. Attorney Michael Hanrahan’s letter said he should also be liable for interest delaying the conclusion of the deal.

It’s not clear what prompted Musk’s legal team to file the settlement, but Musk is due to be fired Thursday in Austin, Texas. The questioning is expected to be difficult, providing leverage for Twitter in talks to close the deal.

Twitter shares closed 1.3% lower at $51.30 on Wednesday. The stock on Tuesday reached its highest level since Musk and Twitter agreed in April that he would buy the company for $54.20 per share.

distraction

Tesla stock closed 3.5% lower on Wednesday as investors fear Musk will have to sell more shares in the electric car maker to fund a Twitter deal and that Twitter may be a distraction for the entrepreneur.

Musk has sold $15.4 billion in Tesla stock this year, but analysts have said he may have to raise an additional $2 billion to $3 billion provided the rest of his funding remains unchanged.

Musk said in July that he was abandoning the takeover agreement because he discovered Twitter had misled him about the number of fake accounts, among other allegations.

See also  Elon Musk's bid for Twitter sparks fear and anger for employees

Part of Musk’s case was based on allegations by whistleblower Peter “Mudge” Zatko on Twitter that were posted in August, and Musk’s legal team on Wednesday dismissed the idea that they had improper conversations with Zatko or spoke to him before his concerns became public.

Twitter’s legal team wanted to investigate whether Alex Spiro, an attorney from the law firm Quinn Emmanuel, who led Musk’s case, had contact with the whistleblower as early as May.

Twitter lawyers suspected that Zatko sent an anonymous email on May 6 to Spiro. The sender claimed to be a former Twitter employee, provided information about the company and suggested contacting by alternative means.

Spiro said in a court filing on Wednesday that he never read the email until it caught his attention on Twitter and appeared to be someone looking for a job. Spiro also said he was not aware of Zatko’s allegations before they were published on August 23.

Register now to get free unlimited access to Reuters.com

(Reporting by Tom Hales in Wilmington, Dale, and Anirban Sen in New York; Additional reporting by Hyunju Jin in San Francisco; Editing by Nick Ziminsky, Matthew Lewis, and Sam Holmes

Our criteria: Thomson Reuters Trust Principles.