Twitter shareholders approve Elon Musk’s $44bn bid to buy company as lawsuit and whistleblower testimony loom

Buyout dispute heads to trial in October

Twitter shareholders on Tuesday voted to formally approve Elon Musk’s $44bn bid to buy the company.

If the deal goes through, the popular social network would go private.

Twitter shares rose around 2 per cent in afternoon trading on the news, The Wall Street Journal reports.

Despite Tuesday’s approval, the buyout has been a rocky one so far.

In July, Mr Musk said he wants to pull out of the deal, claiming Twitter made “false and misleading representations” about the number of fake accounts on the platform and other security issues.

In response, Twitter sued Mr Musk later that month, arguing the billionaire’s attempt to back out was “invalid and wrongful” under the terms of an April contract. The case is expected to go to trial in October in Delaware.

Most recently, Twitter’s former top security official offered testimony in Congress that the social network has concealed massive problems with security vulnerabilities, hackers, loose internal controls for the data Twitter employees can access, and foreign influence operations.

Peiter Zatko, the author of a whistleblower complaint to federal authorities that became public last month, told the Senate on Tuesday that Twitter is “a decade behind industry security standards,” and that foreign agents from India and China had likely infiltrated the company.

“We simply lacked the ability to hunt for foreign intelligence agents and expel them on our own,” he told lawmakers on the Senate Judiciary Committee.

Senators tore into the social network throughout the hearing.

“Twitter is an immensely powerful platform that cannot afford gaping security vulnerabilities,” committee chairman Dick Durbin, a Democrat from Illinois, said in his opening remarks.

Mr Musk has seized on Mr Zatko’s allegations, including that Twitter executives like CEO Parag Agrawal misled its board of directors about the extent of issues with fraudulent accounts, as he attempts to cancel the $44bn deal.

Last week, a Delaware court ruled that Mr Musk would be able to include the whistleblower’s claims as arguments in the contract dispute, while denying the Tesla billionaire’s request to delay the trial.

In August, the social network dismissed the whistleblower’s claims about security, calling Mr Zatko’s account a “false narrative” and noting that he had been fired for “ineffective leadership and poor performance.”

Twitter has said it provided Mr Musk adequate briefing on the number of fake accounts and other key questions during the merger process, describing the billionaire’s criticisms as a pretext to leave a deal he had soured on for other reasons.

“Musk refuses to honor his obligations to Twitter and its stockholders because the deal he signed no longer serves his personal interests,” the company said in July in its lawsuit over the deal. “Having mounted a public spectacle to put Twitter in play, and having proposed and then signed a seller-friendly merger agreement, Musk apparently believes that he — unlike every other party subject to Delaware contract law — is free to change his mind, trash the company, disrupt its operations, destroy stockholder value, and walk away.”