Twitter shares to drop more than 10 percent no relation Twitter v. Musk
Attempted termination
Alleged hold
On May 13, Musk revealed that he had placed the deal "on hold" in the wake of reports that 5 percent of Twitter's daily active users were spam accounts, causing Twitter shares to drop more than 10 percent. Musk clarified that he remained committed to the acquisition, and Agrawal stated he expected the deal to close. In response to a May 16 Twitter thread in which Agrawal said an external review into the platform's users was impractical, Musk tweeted out a poop emoji. The following day, Musk reiterated that the acquisition could not "move forward" until Twitter could prove the aforementioned reports false, urging the SEC to investigate Twitter's daily user numbers. The same day, Twitter filed new documents with the SEC, including a detailed timeline of Musk's purchase, and affirmed they would "enforce the merger agreement" regardless of Musk's actions. On May 25, Musk abandoned plans to partially fund the deal through margin loans against Tesla stock, instead opting to pledge an additional $6.25 billion in equity financing. Dorsey departed Twitter's board the same day, while Twitter investor William Heresniak filed a class-action lawsuit against Musk, alleging that he had violated corporate laws in California by manipulating the market. The lawsuit further declared that Musk was not permitted by the acquisition contract to place the deal on hold, and that Musk's misleading statements had contributed to declining Twitter stock prices.
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