Chancellor Kathaleen McCormick of the Delaware Court of Chancery in a court order on Monday ordered Twitter to hand over documents that are key in calculating the number of bots or fake accounts on Twitter. The court made the decision after Elon Musk’s legal team wrote to the court last week for a permit to question 21 former and present Twitter staff of the social media app with control or relevant information to the number of fake accounts on the platform.
Driving the news
Chancellor McCormick rulings denied Elon Musk’s request for access to 21 staff but ordered Twitter to collect, review, and produce documents from the former General Manager of Consumer Product Kayvon Beykpour.
Background to the story
- Twitter’s board of directors accepted Elon Musk’s $44 billion bid to purchase the company just after acquiring 9.1% of stake in the company.
- Following Elon Musk’s agreement with Twitter’s board of directors, the multi-billionaire developed buyer’s remorse after realizing that fake accounts made up 5% or more of Twitter’s 229 million users.
- Mr Musk then temporarily halted the acquisition of the app to enable him to understudy the social media company to uncover the exact number of fake user accounts. Elon Musk then filed a termination request to the US Securities and Exchange Commission (SEC).
- Twitter further sued Elon Musk to force him to complete the acquisition. Meanwhile, Elon Musk continues to argue he doesn’t have sufficient information on the number of fake accounts on the platform to close the deal.
What you should know
American banks, including Morgan Stanley, Goldman Sachs, JPMorgan, Bank of America, Barclays, and Allen & Co could be amongst the biggest losers if the deal between Twitter and Elon Musk doesn’t fall through as they could lose $192 billion.
Although the banks involved in the deal would earn some cash from advisory roles, they would earn a lump sum if the deal closes.
Morgan Stanley, BofA, Barclays, MUFG, BNP Paribas, Mizuho, and Société Générale have already written a $13 billion loan to support Elon Musk’s acquisition of Twitter.