A judge has postponed a looming lawsuit between Twitter and Elon Musk, which is naming the Tesla CEO more time to finalize his $44 billion deal to buy the company after months of struggling to get out of it.
Musk had asked to drop the upcoming Delaware court case that expected the Tesla billionaire to fare poorly against Twitter’s lawsuit to force him to complete his April merger deal. Musk revived the takeover bid on Monday but said he needed time to get the funding in order.
Chancellor Kathaleen St. Jude McCormick, head of the Delaware Chancery Court, said Thursday that Musk and Twitter now have until Oct. 28 to finalize the deal. A trial originally scheduled for October 17 will take place in November if it doesn’t, she said.
Twitter earlier Thursday asked McCormick to go ahead with the process, saying the billionaire refuses to accept the “contractual obligations” of his April agreement to buy the social media company and take it private.
Twitter denied Musk’s claim that the San Francisco-based company was refusing to accept his renewed offer. Musk told Twitter earlier this week he was ready to buy the company again after trying to go out of business over the summer, and accused it of refusing to provide him with information about “spam bot” accounts to give to the service.
Twitter described Musk’s move to delay the trial as “an invitation to further mischief and delay” after his arguments for terminating the agreement had no merit.
But after the judge’s ruling, Twitter reiterated in a statement that it was ready to close the deal at the share price agreed in April: “We look forward to closing the transaction by October 28 at $54.20,” referring to based on the price originally offered by Musk for each Twitter share.
Brooklyn Law School professor Andrew Jennings said Twitter wants to be sure the deal goes through and “don’t give Musk any wiggle room to walk away.”
Musk’s attorneys argued that Twitter disagreed with delaying the process “due to the theoretical possibility” that Musk could not raise the funding, which they described as “baseless speculation.”
They said Musk’s backers have “acknowledged they are ready to honor their commitments” and are working to close the deal by Oct. 28.
Musk attorney Alex Spiro said in a statement Thursday that “Twitter offered Mr. Musk billions in off the transaction price,” but Musk “declined because Twitter attempted to attach certain self-serving terms to the deal.” He did not explain what the conditions were. Twitter did not describe the talks beyond what its lawyers said in court.
Shares of Twitter fell $1.91, or 3.7%, to close at $49.39 on Thursday. It was the second day of the stock’s decline after rising more than 22% on Tuesday after Musk made his renewed bid to buy the company.