- Lawsuit claims Musk saved himself $156 million
- Investors say Musk trying to pull-out or renegotiate deal
- Twitter shares down 12% since initial stake announcement
Billionaire Elon Musk is being sued by Twitter (TWTR:NYSE) investors who are accusing the world’s richest man of ‘manipulating’ the stock by deliberately delaying disclosure of his stake in the company.
The lawsuit claims that Musk is deliberating driving down Twitter’s stock price so he can walk away from the buyout or renegotiate on better terms. It also claims that Musk saved himself $156 million by not disclosing his initial investment earlier.
San Francisco-based Twitter is also named as a defendant in the lawsuit, which seeks class action status as well as compensation for damages.
TYPICAL MUSK SHENANIGHANS
The Tesla (TSLA:NASDAQ) CEO revealed a significant stake in Twitter on 4 April, and 10 days later proposed a buyout of the social media platform for $44 billion, or $54.20 per share. He has both sold and pledged a chunk of his Tesla stake as collateral for loans to finance the deal.
Musk has since put the takeover ‘on hold’ saying the deal can’t go forward until the company provides information about how many accounts on the platform are spam or bots.
The lawsuit notes, however, that Musk waived due diligence for his take it-or-leave it offer to buy Twitter, which Twitter investors believe means he surrendered his right to look at the company’s non-public finances.
Since Musk’s buyout bid, Twitter’s share price has dropped more than 12%, and Tesla has lost about 30% as part of a broad sell-off in tech stocks. Tesla shares are off almost 40% since Musk first revealed his stake.
