Billionaire Elon Musk is currently in some hot water over his legal acquisition of the social media giant, Twitter.
Back in January, he had started quietly buying up shares until he became the then-largest shareholder in the company.
Once he had purchased a five percent stake in the company, he should have immediately declared it to the public by filing with the Securities and Exchange Commission (SEC). However, the Tesla CEO delayed his disclosure, which allowed him to continue to buy Twitter, some speculate at a lower price, due to investors being unaware of his significant interest in the company.
Elon Musk Is ‘Presently Under Investigation’ For His Twitter Acquisition
As Deadline reported late Thursday night, a legal filing submitted by Twitter cited a document that claimed Musk is “presently under investigation by federal authorities for his conduct in connection with the acquisition of Twitter.”
There were no specifics related to the nature of the investigation, but financial analysts speculate that the investigation is due to the SpaceX founder failing to disclose the five percent shares he purchased in the company earlier this year.
After Musk finally went public with his purchase in April, the Twitter board offered him a chair on their board in exchange for him to stop buying up any more shares in the company. Musk refused and instead proposed his own counter-offer: acquiring the social media giant outright for $54.20 per share, or $44 billion dollars.
However, the acquisition has been anything but simple. Over the past few months, Musk has been vocal on the platform, tweeting that the deal was “on hold” due to the number of bot and spam accounts on the platform. Musk claimed that the information the company reportedly gave him was not sufficient and has claimed that the number of bot and spam accounts is higher than the five percent the company currently claims.
After Musk sought to “terminate” the deal complete back in July, Twitter turned around and sued the 51-year-old entrepreneur. Musk filed his own countersuit, and a trial date was scheduled in Delaware Chancery Court for next week.
Twitter Slams Trial Stay As ‘An Invitation To Further Mischief and Delay’
Only days before he was about to be deposed, Elon Musk suddenly had a change of heart and agreed to buy Twitter after all. The social media giant refused to drop the lawsuit, which led to Judge Kathaleen McCormick agreeing to stay the trial until 5 PM on October 28 to close the deal. If Musk is unable to fund and secure the acquisition at that time, another trial date will be scheduled for November.
Attorneys for the social media company called the trial stay “an invitation to further mischief and delay.” They warned that Musk might yet try to back out of the detail, adding, “Defendants declare they intend to close after all. ‘Trust us,’ they say, ‘We mean it this time,’ and so they ask to be relieved from a reckoning on the merits.”
However, Musk’s legal team quickly fired back against Twitter, alleging that the company “will not take yes for an answer. Astonishingly, they have insisted on proceeding with this litigation, recklessly, putting the deal at risk and gambling with their stockholders interests.”
“Proceeding towards trial is not only an enormous waste of party and judicial resources, it will undermine the ability of the parties to close the transaction,” they added.
In a recent interview with CNN, Alex Spiro, Musk’s attorney, claimed that Twitter’s filing was simply a distraction tactic after Twitter’s former head of security, Peiter “Mudge” Zatko, accused the social media giant of blatantly ignoring security vulnerability present on their platform.
“Twitter’s executives are under federal investigation,” Spiro told the outlet. “This misdirection was sent by Twitter to try and uncover which of their assorted misconduct they are under investigation for.”
Elon Musk Asks Fans To Purchase His New Fragrance So He Can Buy Twitter
— Elon Musk (@elonmusk) October 11, 2022
In order to help finance his purchase, Elon Musk took to Twitter to launch a perfume called “Burnt Hair.” According to Reuters, the product sold 10,000 bottles in only a few hours, accumulating over a million dollars, even though some are still skeptical that the perfume actually exists.
Musk tweeted, “With a name like mine, getting into the fragrance business was inevitable – why did I even fight it for so long!?”
Please buy my perfume, so I can buy Twitter
— Elon Musk (@elonmusk) October 12, 2022