Twitter stock sinks after Elon Musk backs out of $44 million deal to buy the social platform
On Monday, the value of public Twitter stock sank at the start of trading, due to billionaire Elon Musk announcing he's backing out of an agreement to buy the social platform. Shares peaked at $51.70 in April after Twitter's board agreed to Musk's buyout offer of $44 million. But by early Monday afternoon on the New York Stock Exchange, shares of Twitter had fallen by about 9.5%, after they declined by about 5% in premarket trading.
Musk announced on Friday that he wanted out of the Twitter deal, which was agreed to in April. However in May, Musk said the deal was on hold while the company determined how many of its daily monetizable users were phony or spam accounts. Musk said that same issue is the reason he's abandoning the deal. In a letter to Twitter's top legal officer, Musk said that Twitter officials have "not complied with contractual obligations" to assess the number of phony accounts. An attorney for Musk wrote in the letter: "Twitter has failed or refused to provide this information." Twitter has rejected Musk's claim that it has refused to provide information about the phony accounts — and says it will attempt to force Musk to abide by the agreement in court.
On Monday, Musk mocked Twitter in two tweets. The first was a meme showing various facial expressions by Musk laughing at Twitter's failing to disclose the number of "bot" accounts. The second was a photo of meme-popular actor and martial arts expert Chuck Norris sitting at a chess board with the caption: "Chuckmate."
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