US Court Halts Twitter-Musk Trial To Allow More Time To Tesla Chief, Asks To Close Deal By October 28
In a court filing, Musk said banks are working cooperatively to fund the deal but that he needed more time, suggesting a brief delay was better than taking months to go through a trial and appeal.
New Delhi: The trial against Tesla chief Elon Musk over Twitter acquisition has been paused after the Delaware judge gave more time to the billionaire entrepreneur to complete his $44 billion purchase of the social media platform. The litigation has been halted until October 28 to allow Musk to finance the deal, according to a Thursday court filing, reported news agency Reuters.
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What next in the Twitter-Musk battle?
In the latest order, Judge Kathaleen McCormick noted if the deal did not close by the deadline, both parties will come back to her to schedule a November trial. The trial was scheduled to begin on October 17. The billionaire's deposition on Thursday was also postponed on mutual agreement.
While investors seem to be reassured as the order cleared the confusion about the state of the deal. Twitter stocks rose 2.7per cent in after-hours trade after it slipped 3.7 per cent.
In a court filing on Thursday, Musk said that banks are working cooperatively to fund the deal but that he needed more time, suggesting a brief delay was better than taking months to go through a trial and appeal.
On the other hand, Twitter said in a court filing the judge should reject the proposal hinting at the lack of trust between the parties. The social media platform noted that Musk's plan was "an invitation to further mischief and delay."
Twitter was keen that Musk should close next week while a corporate representative for a lending bank testified on Thursday saying Musk didn’t yet send any borrowing notice and neither communicated that he intends to close.
Major banks that committed to fund $12.5 billion, or about 28 per cent of the deal, may end up incurring losses as interest rate hikes have triggered the market volatility and dampened appetite for leveraged financing.
Musk has raised $15.4 billion by selling Tesla shares this year and is leaning on large investors for a chunk of the financing, leading to speculation over whether he will sell more of the electric-vehicle maker's stock to fund the deal.
The world's richest person said this week he would purchase Twitter at the price he agreed in April, $54.20 per share, but conditioned the deal on receiving debt financing.
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