Image Source: CNBC
Over the last two weeks, social media conversations have been dominated by attempts by Elon Musk to acquire 100 percent ownership of microblogging platform Twitter has dominated social media.
Elon Musk and Twitter were immediately sued on Friday by a Florida-based pension fund in the hopes of delaying Musk’s $44 billion takeover of the social media company.
According to the Orlando Police Pension Fund, Musk’s acquisition cannot be completed until at least 2025 under Delaware law, according to a complaint filed in Delaware Chancery Court. The statement went on to say that the takeover is only legitimate if Musk does not possess two-thirds of the stock.
Musk, who became a “interested investor” in April after buying at least 9% of Twitter’s stock, is now expected to face a takeover procedure and a lawsuit, both of which might delay and obstruct his plans to complete the deal.
Musk just bought a 9.5 percent stake in Twitter, making him the social media company’s largest stakeholder. Musk announced in a series of tweets that he has launched a $44 billion bid to buy 100% of Twitter’s stock after declining the company’s invitation to join the board of directors. “I put out a proposition.” He used Twitter to air his grievances. The social media world went crazy after Musk’s announcement, and he later wrote, “I hope even my sharpest opponents remain on Twitter, because that is what free expression means.”
Musk, who also controls Tesla and Space X, is the world’s wealthiest person, according to Forbes magazine.
Twitter and its board of directors, including Twitter CEO Parag Agrawal, are also named in the case.
The complaint, which seeks to delay the merger until at least 2025, also asks the courts to declare Twitter directors to have breached their fiduciary duty and recoup legal fees and costs, according to the claimant.
Elon Musk’s lawyers have yet to respond to a request for comment on the present lawsuit, and Twitter’s top executives have declined to comment.
On Thursday, Musk claimed that he had acquired $7 billion in funds for the acquisition, including from Larry Ellison, the Qatar state investment fund, and the world’s largest cryptocurrency exchange.
Ellison is putting $1 billion into the acquisition, according to a filing with the US Securities and Exchange Commission. Saudi Arabian billionaire Prince Alwaleed bin Talal, who had previously opposed the takeover, agreed to roll his $1.9 billion stake into the deal, according to the filing.
Musk’s $12.5 billion purchase margin loan will be reduced to $6.25 billion, according to the paperwork. Musk will act as the social media platform’s interim CEO for a few months once the acquisition is done, according to CNBC.
When Elon Musk announced his plans to buy Twitter last month, he had no funding lined up. Musk, a self-described “free speech absolutist” who might have an impact on how the San Francisco-based company moderates content, appears to have common objectives with a number of the new investors.
Florida’s state pension system also owns Twitter, and the state’s governor, Ron DeSantis, said this week that if Musk’s takeover is successful, the fund might make $15 million to $20 million.
