Throughout the last few weeks, it feels as though Twitter and Elon Musk have rapidly moved through with a deal in which Elon Musk would acquire the company. It was moving so fast that matters felt all but settled. However, it would seem that neither Twitter nor Musk are going to be able to close the deal without opposition. The Orlando Police Pension Fund, shareholders of Twitter (TWTR), have sued Musk and the Twitter Board of Directors with demand that the closure of the deal be delayed to 2025.
The legal complaint against Twitter and Elon Musk was recently filed in Delaware Chancery Court, as reported by Reuters. According to the complaint, under Delaware law, Musk shouldn’t be able to complete the deal until at least 2025. The caveat would be if owners of two-thirds of shares not held by Musk approved of the deal. In addition to delaying the deal until at least 2025, the lawsuit also aims to declare that Twitter directors have breached fiduciary duties. Finally, it will also seek to recoup legal fees.
If the lawsuit holds up, it could present one of the biggest obstacles to Musk’s acquisition of Twitter yet. Musk’s $44 billion USD offer to buy out Twitter was accepted at the end of April and he has gathered further investments, as well as dumping $4 billion in Tesla (TSLA) stock, for the deal since. It was also suggested that Musk may take over as temporary Twitter CEO once the deal closed. With so much money moving into the acquisition and regular rumors about what comes next going around rapidly, it seemed there was little standing in the way.
Unfortunately for Musk and Twitter, that may not be the case now. At the very least, it would seem this lawsuit must be settled before anything further can happen. As we await whether the lawsuit goes through, the shareholders approve, or further changes, stay tuned for updates here at Shacknews.