Elon Musk, the CEO of Tesla, has until Friday to finalize the purchase of Twitter or risk going to court, according to CNN Business.
Eric Gordon, a professor of business law at the University of Michigan, said Judge Kathleen St. J. McCormick was unlikely to offer an extension and would encourage Musk to start the trial quickly if the deadline passed.
Billionaire Musk needs to close the deal by 5 pm on Friday, so time is ticking. Meanwhile, Tesla CEO Elon Musk is under investigation by US federal authorities in connection with his Twitter takeover deal, media reports said in a microblogging court filing by his site.
In its court filing, Twitter did not elaborate on the matter, simply saying it was investigating Musk’s “conduct” in connection with the transaction. Musk’s legal department appears to be the primary check.
Twitter accused Musk’s legal team of failing to provide a draft of his correspondence with the Securities and Exchange Commission and a slide presentation to the Federal Trade Commission. This is part of an ongoing legal battle between the two over whether Musk can cancel the contract, CNN reported.
Musk’s situation would worsen if he went to court
If the trial proceeds, Musk could face lengthy testimony and publish more of his private writings, according to the New York City-based international nonprofit legal think tank and litigation fund. said Gerald Filitti, senior attorney at The Lawfare Project.
Last week, Bloomberg reported that Twitter and Musk were preparing documents to complete the deal by Friday’s deadline, citing multiple sources familiar with the matter. Twitter appeared suspicious of the billionaire’s intentions when Musk first petitioned to end the lawsuit and buy the company for the original price. The company has said it will not complete the transaction until Musk can prove to finance.
Musk’s initial funding package for Twitter includes $21 billion in cash, his $12.5 billion margin loan backed by his 16% stake in Tesla, and his $12.5 billion loan from multiple banks. included $13 billion in loans.
The banks, including Morgan Stanley, are completing funding. The tycoon still owes $32 billion, but according to Wedbush tech analyst Dan Ives, he is likely to sell $5 billion to $10 billion in Tesla stock to help pay for the transaction.