Twitter shares tumble in pre-market trading as Elon Musk laughs at legal action

Billionaire Tesla chief posts a meme showing how he feels about looming court battle

Mr Musk withdrew from the $44bn Twitter deal on Friday. Photo: Reuters
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Twitter shares fell almost 7 per cent in pre-market trading on Monday following Elon Musk's decision to pull the plug on his $44 billion offer to acquire the social media company.

The company's stock closed 5 per cent lower at $36.81 on Friday, its lowest close since May 24, as Mr Musk withdrew from the deal owing to lack of information on spam activity, a filing with the US Securities and Exchange Commission showed.

He responded in typical fashion on Monday to potential legal action from Twitter, posting a meme on the platform showing him laughing increasingly through various stages of his failed deal, with his seemingly funniest moment coming if Twitter has to disclose bot, or spam account, data in court.

His offer in April at $54.20 per share was eventually approved after Twitter "committed" to the deal, with terms including a $1bn breakup fee if the merger did not go through.

Twitter responded on Friday with a short statement, saying: "We are committed to closing the transaction on the price and terms agreed upon with Mr Musk and plan to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery."

Twitter has hired law firm Wachtell, Lipton, Rosen & Katz to sue Mr Musk and force him to complete the deal, according to Bloomberg. The microblogging site aims to file a legal suit early this week, it said, citing people familiar with the matter.

Twitter said last week that it removes a million spam accounts each day, and reiterated that they were well below 5 per cent of users who are served advertising.

However, in May, a study by Israeli cyber security company Cheq found that up to 12 per cent of visits to Twitter were from bots.

Some Twitter influencers have claimed that Mr Musk's decision to pull out of the deal may have just been a manoeuvre for him to sell $8.5bn in Tesla stock options that were about to expire.

Updated: July 11, 2022, 12:23 PM
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