Elon Musk’s ongoing feud with Twitter has taken some bizarre turns that don’t seem to be ending anytime soon. The most recent piece of evidence in court suggests that the world’s richest man may have backed out of the deal not because of concerns about bots or Tesla’s stock price, but because he believed World War Three was imminent.
The Musk-Twitter saga began in April, when the eccentric billionaire revealed himself to be the largest shareholder in the social media platform. Musk then stated his intention to purchase Twitter and transform it into a “free speech platform.” Although many people were unsure how to react to an announcement from a man who jokingly threatens to buy major corporations like Manchester United every few years, the revelation quickly turned into a formal bid. Things appeared to be moving smoothly at first, with Musk making an offer for the company worth around $54.20 per share, or roughly $44 billion in total. The offer was accepted, and Musk put up a significant portion of his own capital, as well as some loans he had obtained. Then something went wrong.
Musk stated that he was not convinced by the company’s estimates that only 5% of Twitter accounts were controlled by bots. The 51-year-old requested the process Twitter used to calculate that figure, as well as a large amount of data for his team to review and confirm the figures. The request was deemed unreasonable by Twitter, and it was denied. Musk then backed out of the deal. But it didn’t stop there. Twitter decided to sue, and things have only gotten weirder since then.
Putin’s speech may have made Musk pull out
According to new allegations, Musk backed out of the deal due to concerns about the start of a new world war. According to Business Insider, the accusation is based on a series of texts the billionaire allegedly sent to a Morgan Stanley banker who was involved in Musk’s attempts to raise funds for the takeover. The bank was expected to lend $13 billion to the world’s richest man.
One of the social media firm’s attorneys read out the relevant texts in court. The billionaire is said to have sent the following message: “Let’s take it easy for a few days. Putin’s speech tomorrow is critical. If we are on the verge of World War III, purchasing Twitter makes no sense.” The speech in question was Russian President Vladimir Putin’s Victory Day speech on May 9. (via Business Insider).
The day commemorates the Soviet Union’s contributions to World War II victory over Nazi Germany. It is extremely important for Russia and includes a military parade in Moscow. At the time, the war in Ukraine had been raging for nearly three months, and Russia had failed to meet any of its key objectives. Despite the sanctions and high tensions, Putin did not declare war on the West during his speech, but he did reiterate that the war in Ukraine was “the only right decision” and accused the West of plotting an invasion of Russia.
Musk’s lawyers dismissed the claims as “utter nonsense,” claiming that the full series of texts between Musk and the Morgan Stanley banker will disprove Musk’s withdrawal from the deal due to concerns about World War III. Next week, lawyers are expected to present the full text chain to the court (via Business Insider).
Losing the case could cost Musk billions
When Musk entered into serious talks to buy Twitter, he agreed to pay a $1 billion break fee if he backed out. The billionaire, however, is attempting to argue that he should not be allowed to pay because Twitter withheld information during the negotiation process. If he loses the case, he will almost certainly have to pay the massive break fee. However, a courtroom defeat could cost Musk much more than that.
Twitter’s lawyers are hoping that a victory will result in a judge ordering Musk to buy the social media platform. That means Musk would have to pay the $44 billion owed when he agreed to buy Twitter in the first place. It’s possible he’ll be made the platform’s reluctant owner due to a contract law concept known as “specific performance,” which applies in cases where simply paying the break fee isn’t enough to make things right. The Tesla founder has been accused by Twitter’s board and shareholders of “trashing” the company, “disrupting its operations,” and “destroying stockholder value.” So, even if $1 billion is a large sum, it may be argued that it will not compensate for the damages incurred.
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If the ruling stands, it will be one of the most significant cases in legal history to result in a specific performance ruling. Due to the scarcity of similar high-profile cases, legal experts are unsure how it will play out. According to one of the best guesses, Musk’s net worth could drop by around $5 billion by the end of this case.