London – Twitter stepped up the pressure on Elon Musk, calling for a September 13 shareholder meeting to vote for the businessman to buy the company for US$44 billion.
After weeks of questioning the platform’s actual user count, on July 8, the world’s richest man announced his decision to cancel the purchase, accusing Twitter of failing to count spam and bot accounts.
Last week, the platform released its results for the quarter, blaming the uncertainty of the turbulent buying process for the reported losses.
Maximum pressure on Musk to complete Twitter purchase
The shareholders’ meeting will be held before the hearing of the case begins and will serve as a pressure to show that the board wants the transaction to be completed, and will reinforce the business’ losses if it doesn’t happen by October 24. agreement.
After Musk’s withdrawal was made official by lawyers, Twitter sued the businessman to force the businessman to abide by the deal, with a $1 billion fine in case of withdrawal.
The businessman’s defense called for the dispute to be tried in early 2023, using the complexity of the case as one of the arguments.
As he has done on other occasions, the businessman reacted to the case with irony on Twitter, stating that the platform would have to present data on user numbers in court.
— Elon Musk (@elonmusk) 11 July 2022
But last week, Twitter made a positive decision in the preliminary hearing, and the five-day trial will take place in October.
Delaware Court Chancellor Kathaleen St. Jude McCormick mocked the attempt to delay, saying that “the party underestimates this court’s ability to process complex cases quickly.”
In the 60-page lawsuit, Twitter alleges that the Tesla boss “refuses to honor his obligations to Twitter and its shareholders because the deal he signed no longer serves his personal interests.”
Twitter argues that Musk tried to pull back because he agreed to pay 38% above Twitter’s stock price just before the stock market crashed.
And shares of electric car maker Tesla, which make up the bulk of his personal wealth, have lost more than $100 billion in value.
Shareholders meeting will be published online. The company said in a statement to the US Securities and Exchange Commission that shareholders can watch the meeting live and vote.
Twitter’s board has already asked its shareholders to approve the sale of the company to Musk.
Confusion about purchasing would cause losses
Elon Musk’s acquisition of Twitter has been marred by controversy. Announcing his decision to buy the platform and signaling significant changes such as loosening moderation, the entrepreneur was rejected by Twitter executives and staff.
There were doubts about whether he would accept the offer. But he did, and the board agreed to Twitter’s proposed sale for $44 billion.
From there, another saga began, with public disagreement between billionaire and Twitter CEO Parag Agrawal over the actual number of users, which could be between 5% and 20%. Musk responded to one of Agrawal’s posts with a poop emoji.
Also Read | 5% or 20%? Recent moves in the ‘war’ over fake accounts between Musk and Twitter CEO
In Musk’s understanding, more fake or spammy accounts than initially announced will jeopardize the value of the business and affect future profit projections.
According to Twitter, confusion was partly responsible for the financial results announced last week.
Revenue was disappointing, though the number of daily users of the social network rose to 237 million in the second quarter.
Analysts had expected revenue of $1.32 billion in 2021, representing growth of 10.5% over the same period.
However, it was a 1% drop, the company’s worst loss, with results 11% below estimates, according to an analysis by Refinitiv.
In presenting the balance sheet, Twitter justified that “uncertainty” had undermined advertisers’ trust and caused concern among employees. The social network also blamed headwinds in the advertising industry for the slowdown.
The company said it has already spent $33 million on acquisition-related expenses.
In the first quarter of this year, Twitter posted positive results with revenue of $1.2 billion, up 15.9% compared to the first quarter of last year.
Net income was $513.2 million – seven times more than in the same period in 2021. The market value of the brand also increased.
Also Read | Musk laughs in vain: Twitter brand value increased 85% this quarter and profits increased sevenfold
source: Noticias
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