Billionaire Elon Musk is proposing to proceed with his original $44 billion bid to take Twitter Inc (TWTR.N) private, security filings showed on Tuesday, calling for an end to a lawsuit by the social media company that could have forced him to pay up, whether he wanted to or not, Reuters informs.
In agreement would put the world’s richest person in charge of one of the most influential media platforms and end months of litigation that damaged Twitter’s brand and fed Musk’s reputation for erratic behavior.
Musk, the chief executive of electric car maker Tesla Inc (TSLA.O), will take over a company he originally committed to buying in April, but soon soured on. Late on Tuesday he tweeted that buying Twitter would speed up his ambition to create an “everything app” called X.
The renewed offer comes ahead of a highly anticipated face-off between Musk and Twitter in Delaware’s Court of Chancery on Oct. 17, in which the social media company was set to seek an order directing Musk to close the deal for $44 billion.
Musk sent Twitter a letter on Monday that said he intended to proceed with the deal on the original terms if the Delaware judge stayed the proceedings. A source familiar with Twitter’s team told Reuters that at a court hearing on Tuesday morning the judge requested the two sides report back in the evening.
It was not immediately clear why Musk chose to abandon his fight, although some pointed to his scheduled deposition.
“He was about to get deposed and a lot of uncomfortable facts were going to come out,” said Eric Talley, a professor at Columbia Law School.
Twitter received Musk’s letter and intended to close the deal at the original price, a spokesperson told Reuters. Twitter did not say whether it accepted Musk’s offer.
Musk, one of Twitter’s most prominent users, said in July he could walk away without penalty because the number of bot accounts was much higher than Twitter’s estimate of less than 5% of users. Bots are automated accounts, and their use can lead to overestimations of how many humans are on the service, which is important for advertising rates and the overall value of the service.
Twitter’s legal team on Sept. 27 said that scientists employed by Musk estimated the number of fake accounts on the platform at 5.3% and 11%.
“None of these analyses so far as we can tell remotely supported what Mr. Musk told Twitter and told the world,” Twitter lawyer Bradley Wilson told the court.
The original deal was “a very seller-friendly agreement that would be very difficult to get out of,” said Adam Badawi, a law professor at UC Berkeley. Musk realized, he said, “in all likelihood it was going to result in forcing him to close at $54.20 a share.”
Musk was relatively quiet on Twitter during the day, but late on Tuesday he tweeted that “Twitter probably accelerates X by 3 to 5 years”.