Twitter Shares Drop as Elon Musk Backs Out

Twitter's share price stood at about USD 32.64 as Monday trading closed - dropping further below the USD 54.20-a-share price agreed by Musk and Twitter's board. Twitter now intends to take legal action and has hired a top US law firm.

FREMONT, CA: Twitter shared fell on Monday after Elon Musk declared he was pulling out of the $44bn deal to purchase the social media platform. Musk backed out after asserting that the company failed to furnish sufficient information on the number of spam and fake accounts. Twitter now intends to take legal action to complete the deal and has hired a top US law firm. Elon Musk tweeted stating that Twitter must disclose bot info in court. Twitter's share price stood at about USD 32.64 as Monday trading closed - dropping further below the USD 54.20-a-share price agreed by Musk and Twitter's board.

This will be the first time investors are reacting to Elon Musk's statement on Friday that he wanted to pull out of the deal. Musk, who is also the CEO of Tesla, publicised plans to buy Twitter in April, but the contract was put on hold due to a row over the number of fake accounts on the platform.

The original coalition agreement includes a USD 1bn break-up fee, but rather than pushing for Elon Musk to yield the sum, Twitter wants him to compete in the deal. The Twitter board is devoted to closing the trade on the price and terms agreed upon with Musk. Twitter now has hired New York's Wachtell Lipton Rosen & Katz, one of the world's leading corporate law firms. When he first agreed on the contract, Elon Musk wanted to make the site better by removing the spam bots and authenticating all humans. Twitter for a long has had an issue with automated bots being used to post unhelpful or deceptive content. Musk had asked the company for proof to back its claims that spam and bot accounts make up less than five per cent of its total users.