Elon Musk has terminated his Twitter takeover deal but may be forced by a US court to complete the transaction.

Lawyers for the Tesla chief executive sent a letter to Bret Taylor, Twitter’s board chair, with Skadden Arps attorney Mike Ringler stating that Twitter had ‘not complied with its contractual obligations’, according to a Security and Exchanges Commission (SEC) filing.

In a Tweet, lawyers said on behalf of Musk: “Mr Musk is terminating the merger agreement because Twitter is in material breach of multiple provisions of that agreement, appears to have made false and misleading representations upon which Mr Musk relied when entering into the merger agreement, and is likely to suffer a Company Material Adverse Effect.”

Representatives for Twitter soon hit back with a Tweet issued by Taylor, stating: “The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr Musk and plans to pursue legal action to enforce the merger agreement.”

He added: “We are confident we will prevail in the Delaware Court of Chancery.”

The agreement and plan of merger filed with the SEC states: “As a material inducement to, and as a condition to, the Company entering into this Agreement, concurrently with the execution of this Agreement, Elon Musk (the “Guarantor”) has entered into a limited guarantee, dated as of the date hereof, guaranteeing certain of Parent’s and Acquisition Sub’s obligations under this Agreement.”

Twitter has assembled a legal team to sue Musk, according to Bloomberg.

Brian Quinn, an associate professor at Boston College law school, told Bloomberg: “They will likely be asking for a declaratory judgment that they are not in violation of the contract.”

He added: “Also, they will ask for an order from the court that Musk specifically perform his obligations under the agreement.”

Share Story: