A Florida pension fund is challenging Tesla (tsla. US) CEO Musk's $44 billion acquisition of twitter (TWTR. US), saying his financial arrangements with other shareholders of the social media platform should prevent the transaction from being completed by 2025.
The Orlando Police Pension Fund filed a complaint against twitter and its board of directors, including CEO Parag Agrawal, in the Delaware justice court.
Delaware law reportedly prohibits fast mergers because musk has reached agreements with other twitter shareholders to support the acquisition, including his financial adviser Morgan Stanley and twitter founder Jack Dorsey.
The fund claimed that the arrangement triggered a Delaware law requiring a three-year delay in completing such transactions. These arrangements make musk an "interested shareholder" who must wait three years to complete the transaction or win the support of investors who control "at least 66% (2 / 3) of twitter voting shares" and are independent of musk.
Twitter accepted Musk's offer of $54.20 per share in April. The billionaire said his purpose was to protect freedom of speech, which is why he wanted to privatize twitter. Musk confirmed in a regulatory document last month that he had obtained some financing commitments to support the acquisition of twitter.
The Federal Trade Commission (FTC) is reviewing Musk's $44 billion acquisition of Twitter and has set a deadline for the committee to decide whether to conduct an in-depth review of the deal next month, people familiar with the matter said.