Twitter is seeking a trial in September
Twitter says the billionaire was deliberately contemptuous of the social network that resulted in a significant hit to its stock price over the past two months. It’s now pursuing legal action to make him close the transaction at the agreed upon $54.20 a share.
Musk apparently believes that he, unlike every other party subject to Delaware contract law, is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away.
The communications company accused Musk of breach of contract and has asked the Delaware court for a four-day trial in mid-September.
Pro explains what it means for the Twitter stock
According to Karen Finerman – the CEO of Metropolitan Capital Advisors, the announcement could be a positive for the Twitter stock. Explaining why on CNBC’s “Fast Money”, she said:
I think they have the better side of the argument. So, it’ll read very well, the stock will trade up. The compelling argument is that Musk will need to close. That’s the most likely outcome. So, I’m staying long.
Elon Musk will have to pay $1.0 billion to Twitter in break-up fee if he gets to walk away. The NYSE-listed firm, however, will likely seek “damages” as well in such an event. It’s scheduled to report its quarterly results in the final week of July.
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