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Photo of Elon MuskElon Musk may walk away from the Twitter buyout deal

The shares of Twitter Inc. dropped by 9% when Elon Musk, the SpaceX billionaire, announced that he will terminate his agreement on acquiring the social media giant. Since late April, the shares of Twitter have been on a rollercoaster since Elon Musk offered to buy the social media behemoth.

Elon Musk offered $44 billion to acquire Twitter. On the other hand, Twitter will approach the issue legally if Elon backs out of the deal, and it is possible for him to pay $1 billion as a break-up fee. He threatened to back out of the deal if the three issues presented to Twitter were not addressed. The deal could not be completed because of the following:

1) fake accounts: He disclosed that the number of users that the social media platform claimed that it has was faked. “There are many fake accounts on Twitter, including bots account,” he explained. His stand was to know the number of genuine users that the social media giant has. Twitter’s independent board chair, Bret Taylor, said that they are committed to following the terms of the agreement.

2) financing from the bank: The majority of Elon Musk’s money is invested in Tesla’s stocks. He is willing to pay $33.5 billion in cash, and he has gotten $7.1 billion from Binance and Larry Ellison, the co-founder of Oracle, as a financing commitment. He planned to balance it up with a bank loan that has not been finalised yet. 

3) Approval from Twitter’s shareholders: The shareholders will vote on the embattled deal. The vote is expected to take place in late July or the first week of August 2022. Elon Musk must win the majority to bag the deal.