The Elon Musk Twitter Buyout Just Took ANOTHER Major Turn
(ConservativeHub.com) – According to a recently filed legal document, LLP, Twitter shareholders filed a class-action lawsuit against Elon Musk and Twitter. They allege Musk illegally manipulated stock prices through his actions surrounding his bid to buy the social media company. In addition, the group claims he caused a significant stock price drop, which negatively impacted them.
The Issues With Musk
In April, Musk announced his intention to buy Twitter for $44 billion. Since then, the company’s stock price has eroded by over 12%. The shareholders believe the billionaire violated corporate laws in California by trying to manipulate the market.
The Claims Against Him
The stockholders say Musk began his deceitful practices when he bought a large portion of Twitter stock and failed to disclose it promptly. He then reportedly delayed announcing his intention to become a board member at the company. The plaintiffs also allege Musk had inside information when he bought his shares in the company due to relationships with executives and board members.
In their complaint, the shareholders say his consistent tweets about the deal influenced the market. This accusation includes his recent concerns over bots and putting the acquisition on hold. They claim his actions were part of a plan to lower stock prices so he could purchase the company for less than his initial bid — or back out of the deal completely.
The complaint asks the court for a jury trial in the matter. When the BBC reached out to the parties for comment, Twitter declined, and Musk’s representatives didn’t respond.
The Current Situation
On May 24, Musk filed a notice with the US Securities and Exchange Commission (SEC) stating he committed $33.5 billion to the purchase of Twitter. The new financial plan also accounts for $6.25 billion in equity he would use in the acquisition.
He previously said the deal was on hold due to his concern over the large percentage of fake accounts and bots on the platform. Early in May, the BBC reported Musk spoke at a technology conference where he said he might make a deal to buy the company for less than he originally offered.
In light of the lawsuit, multiple questions have arisen: Will Elon Musk really succeed in buying the platform? How will this lawsuit impact the sale? Will everything derail if the stockholders succeed in court?
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