In a class action lawsuit in Delaware Chancellery Court, the Orlando Police Pension Fund said the Delaware law forbids a quick merger because Musk had agreements with other major Twitter shareholders, including financial adviser Morgan Stanley and Twitter founder , Jack Dorsey, to support takeover.
The fund said those deals were made by Musk, who owns 9.6% of Twitter, the actual “owner” of more than 15% of the company’s shares. He said the merger should be postponed for three years, unless two-thirds of the shares not owned by him were approved.
Morgan Stanley owns about 8.8% of Twitter shares, and Dorsey owns 2.4%. Musk hopes to complete Twitter’s $ 54.20 per share takeover this year, one of the largest leverage acquisitions in the world.
Musk also runs the electric car company Tesla Inc. (TSLA.O), runs The Boring Co and SpaceX, and is the richest person in the world, according to Forbes magazine.
Twitter and its board of directors, including Dorsey and CEO Parag Agrawal, have also been named as defendants.
Twitter declined to comment.
Musk’s lawyers and the Florida fund did not immediately respond to requests for comment.
The lawsuit also seeks to declare that Twitter executives have breached their fiduciary duties and to recover legal fees and costs. The complaint does not clarify how shareholders believe they could be harmed if the merger ends on time.
On Thursday, Musk said he had raised about $ 7 billion, including from sovereign wealth funds and friends in Silicon Valley, to help fund a takeover.
Musk had no secured funding when he announced plans to buy Twitter last month.
Some of the new investors seem to have common interests with Musk, who is a self-described absolutist of free speech, who could change the way the San Francisco company moderates content.
Florida’s state pension fund is also investing in Twitter, and Gov. Ron DeSantis said this week that he could make $ 15 million to $ 20 million if Musk completed his acquisition.
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