Twitter Inc.’s board said it plans to enforce its $44 billion agreement to be bought by Elon Musk, saying the transaction is in the best interest of all shareholders.
“We intend to close the transaction and enforce the merger agreement,” the board said Tuesday in a statement to Bloomberg News. Directors voted earlier to unanimously recommended that shareholders approve Musk’s $54.20-a-share offer.
The proposed takeover includes a $1 billion breakup fee for each party, which the Tesla CEO will have to pay if the deal falls apart due to financing issues. But Musk can’t just walk away by paying the charge.
The merger agreement includes a specific performance provision that allows Twitter to force Musk to consummate the deal, according to the filing. That could mean that, should the deal end up in court, Twitter might secure an order obligating Musk to complete the merger rather than winning monetary compensation for any violations of it.