Shares of Twitter fell more than 9 percent in trading Monday as investors anticipated a potentially protracted legal battle between the social media company and Elon Musk over its move to cancel a deal to buy the company.
Mr. Musk reached an agreement about three months ago to buy Twitter for $44 billion. On Friday, after the market closed, he attempted to withdraw from the legally binding acquisition agreement, alleging that Twitter failed to provide the information needed to calculate the number of spam accounts on the platform.
Twitter’s stock has lost about a third of its value since April 25, when Mr. Musk’s offer to buy the company was accepted by the company’s board of directors. Since the deal was signed, investors have become increasingly skeptical that the acquisition by the mercurial billionaire would be made on the terms agreed upon. Twitter’s shares traded below the $54.20 price offered by Mr. Musk, and well below the highs it reached above $70 last year.
Mr. Musk has been sparring with Twitter executives for months over his request to obtain information on how it detects and counts spam accounts on the platform. He has even expressed his dismay online, going so far as to tweet a poo emoji to Parag Agrawal, the company’s CEO, in response to his tweet explaining how Twitter detects spam accounts. Experts have said Mr Musk’s reasoning is legally flawed and believe his focus on bogus bills could be a tactic to negotiate a lower purchase price.
In May, Mr. Musk said buying Twitter at a lower price was “not out of the question” at a technology conference in Miami. Twitter chairman Bret Taylor tweeted Friday that the company’s board is determined to close the deal “on the price and terms agreed with Mr. Musk” and plans to take legal action against him.
