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Twitter Lawsuit Stalled, So Elon Musk Has Until October 28 to Close The Deal

Picture Source: Internet

A Delaware judge on Thursday ordered Twitter Inc to stop its lawsuit against Elon Musk on the eve of trial, giving the billionaire time to buy social media platform Funding for $44 billion.

The ruling comes after days of uncertainty over Musk’s intentions, and this week removed the turbulent entrepreneur’s threat to have to take an oath over claims that Twitter fraudulently misled him.


The judge’s order said that if Musk, the world’s richest man, fails to meet the October 28, 5 pm EDT deadline, he will set the trial for November. “We look forward to closing the deal at $54.20 by October 28,” Twitter said in a statement. In an earlier court filing, the company urged a judge to reject the proposal, calling Musk’s plan an “invitation to further mischief and delay.”


Elon Musk, CEO of electric car maker Tesla Inc, is scheduled to stand trial on October 17, but a mutual agreement delayed his testimony on Thursday.


Shares of Twitter plunged 3.7% at $49.39, up 1% in after-hours trading, as investors seemed relieved after days of confusion. Musk said he would buy Twitter for $54.20 a share this week, a deal he agreed to in April on the condition that the deal secures debt financing.


It marks a reversal for Musk, who has been fighting Twitter for months to try to back out of the deal. He claimed Twitter misrepresented its platform’s true number of users, among other claims.


Musk said in court filings Thursday that banks are working together to fund the deal, but he needs more time. He argued that a brief delay was preferable to the months needed for a trial and appeal.


Twitter said Musk should shut down next week and said a company representative for a lending bank testified Thursday that Musk did not send them a borrowing notice or communicate his intent to shut down.


Major banks that pledged to fund $12.5 billion, or about 28% of the deal, could face huge losses as interest rate hikes accelerate, fuelling volatility and dampening appetite for leveraged financing.


Musk has raised $15.4 billion this year by selling Tesla stock and has relied on large investors for much of the financing, leading to speculation over whether he will sell more electric carmakers to fund the deal.

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