July 3, 2022

Musk’s $ 44 billion Twitter acquisition partner challenged

May 6 (Reuters) – Elon Musk and Twitter Inc. (TWTR.N) Musk filed a lawsuit Friday against the Florida Pension Fund seeking to block the $ 44 billion acquisition of the social media company before 2025.

In a proposed class action filed in Delaware Sancheri Court, the Orlando Police Pension Fund, Delaware law barred rapid mergers because Musk had deals with other major Twitter partners, including his financial adviser Morgan Stanley. (MSN) And Twitter founder Jack Dorsey, to support the purchase.

The deals saw Musk, who owns 9.6% of Twitter, effectively “own” more than 15% of the company’s shares, the fund said. It said the merger should be delayed for three years until two-thirds of those who do not “own” it approve it.

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Morgan Stanley holds 8.8% of Twitter shares and Dorsey 2.4%.

Musk hopes to complete its $ 54.20 share acquisition of Twitter this year, one of the largest foreign spending in the world.

He also runs an electric car company called Tesla Inc. (TSLA.O)He heads The Boring Go and SpaceX, and is the richest man in the world according to Forbes magazine.

Twitter and its team, including Dorsey and CEO Barack Agarwal, were named as defendants.

Twitter declined to comment. Lawyers for the Musk and Florida funds did not immediately respond to requests for comment.

The lawsuit alleges that the directors of Twitter violated their trusted obligations and sought legal redress. It is not clear how the shareholders hope to be affected if the merger closes on schedule.

On Thursday, Musk said he had raised about $ 7 billion to acquire sovereign wealth funds and friends in Silicon Valley. read more

When Musk announced his plans to buy Twitter last month he had no funds.

Some of the new investors share their interests with the San Francisco-based company Musk, a self-described independent talkist who can change how he controls content.

Florida’s state pension fund is also investing in Twitter, and Governor Ron Desantis said this week that Musk could make between $ 15 million and $ 20 million in profits if he completes his purchase.

In the afternoon trade, Twitter shares fell 60 cents to $ 49.76.

Case Orlando Police Pension Fund v Twitter Inc. et al., Delaware Sancheri Court, no. 2022-0396.

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Report by Jonathan Stempel in New York edited by Howard Collar and Mark Potter

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