Morgan Stanley, BofA subpoenaed by Twitter in Musk fight

Among the documents sought are those relating to Musk’s initial plans to partially fund his Twitter purchase with a margin loan tied to his Tesla stake.
Image: Bloomberg

Twitter subpoenaed records from Morgan Stanley and other financial firms as part of its legal fight with Elon Musk over his canceled $44 billion acquisition of the social media platform.

Morgan Stanley was Musk’s chief financial adviser on the proposed deal and pledged up to $5.5 billion in financing. In a series of subpoenas posted Monday in Delaware Chancery Court, Twitter also sought documents from Bank of America, Barclays PLC, BNP Paribas, Citigroup Inc. and several other banks that committed to backing Musk’s acquisition.

The pre-trial request for information seek a wide range of communications and documents about Musk’s bid to acquire Twitter for $54.20 a share, which he nixed over claims that the company failed to provide him with information about spam and bot accounts.

Among the documents sought are those relating to Musk’s initial plans to partially fund his Twitter purchase with a margin loan tied to his Tesla Inc stake. In May, Musk dropped the margin loan and provided additional equity financing.

Twitter itself was advised on the deal by Goldman Sachs Group Inc. and JPMorgan Chase & Co.

In its suit seeking to compel Musk to complete the acquisition, Twitter argues that the world’s richest person is using his bot account claims as a pretext to walk away from the deal.

Delaware Chancery Court judge Kathaleen St. J. McCormick has scheduled a five-day trial starting on Oct. 17.

On Friday, Musk’s lawyers filed an answer to Twitter’s suit under seal.

The case is Twitter v. Musk, 22-0613, Delaware Chancery Court (Wilmington).

© 2022 Bloomberg

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