Yahoo Finance Musk Deposition Delayed in Twitter Suit as Buyout Advances
(Bloomberg) -- Elon Musk and Twitter Inc. agreed to postpone the billionaire’s long-awaited deposition in the company’s lawsuit aimed at forcing him to go through with a $44 billion buyout, according to people familiar with the matter.
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Musk reversed course earlier this week and committed himself to consummating the $54.20-per-share offer for the social-media platform on its original terms. Even though the deal still may take months to close, a trial set for Oct. 17 is almost certain to be put on hold.
Both sides agreed Wednesday to delay the deposition that was set for Thursday morning in Austin, Texas, while lawyers try to finalize procedures to dispose of the suit, according to the people, who declined to be identified discussing a confidential matter.
Twitter shares fell 1.4% to $50.58 in New York Thursday morning, suggesting the stock market at least isn’t entirely sold on the doneness of the deal.
Meanwhile, banks and other investors are reviewing the deal’s original $12.5 billion debt-financing package. The lenders are led by Morgan Stanley. Other investors include Oracle Corp. Chief Executive Officer Larry Ellison.
Before restoring his original offer, Musk’s representatives held talks with Twitter on lowering the deal price, people familiar with the negotiations told Bloomberg News. Musk was seeking a price cut of 30%, and more recently explored a 10% discount, but the discussions failed to yield an agreement, the New York Times reported, citing unidentified sources.
Delaware Chancery Judge Kathaleen St. J. McCormick said Wednesday that since neither side has yet asked to pause the case, she’s pressing ahead with the upcoming trial. In a securities filing earlier this week, Musk offered to go forward with the deal if Twitter’s suit was put on hold.
Twitter didn’t immediately respond to a request for comment after regular business hours on the deposition being delayed.
Musk skipped out on other deposition dates in the case. He cancelled a Sept. 28 meeting to answer questions because of Covid-19 concerns, according to court filings. He also demanded that the deposition be conducted in Texas instead of Delaware.
Musk backed away from his planned Twitter purchase earlier this year, claiming the company hadn’t leveled with him and investors about the number of bot accounts that artificially pump up advertising revenue. Twitter countered that the concerns were a pretext for Musk when he started feeling buyer’s remorse.
In the past, Musk –- chief executive officer of electric-car maker Tesla Inc. -- has turned belligerent in pre-trial questioning in other court cases focused on his deal-making efforts.
In a deposition tied to a suit by Tesla investors over Musk’s buyout of renewal-power company SolarCity, the billionaire belittled a lawyer for shareholders who argued the deal was rife with conflicts.
“To bail out SolarCity was good for the world you’re telling us?” investors’ attorney Randy Baron asked in a pre-trial query.
“Advancing solar is absolutely good for the world,” Musk shot back. “Do you just think about money? What is your purpose in life?” Musk’s deposition testimony was played in the 2021 trial of the SolarCity dispute.
During his cross-examination at trial, Musk told a Delaware judge he didn’t respect Baron, who he considered to be “a bad human being” who specialized in asking deceptive questions. The judge ultimately ruled for Musk in the case.
The case over the Twitter buyout is Twitter v. Musk, 22-0613, Delaware Chancery Court (Wilmington).
(Updates with share trading in fourth paragraph)
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