In a series of tweets sent Friday, Twitter CEO Parag Agrawal has revealed that Elon Musk’s deal to buy the company could fall through.

A lot has happened in the past few weeks. I’ve been focused on the business and haven’t said much publicly during this time, but I will now.

– Parag Agrawal (@paraga) May 13, 2022

Prepare for all scenarios

″While I expect the deal to go through, we need to be prepared for all scenarios and always do what’s right for Twitter,” Agarwal said. “I am responsible for the direction and operation of Twitter, and our job is to build a stronger Twitter every day.”

Musk already had tweeted earlier Friday that the case was on hold until he could determine how many fake accounts, like spam bots, were on the platform. This decision caused the stock to fall by almost 10%.

But getting out of the deal may prove more complicated than previously thought. Musk could have to pay a $1 billion reverse termination fee to Twitter and risk a breach of contract lawsuit that could cost him much more.

Indeed, in this case, there is no external reason why the agreement cannot be concluded, such as regulatory intermediation, third-party financing problems or fraud. Only these three reasons would allow Musk to withdraw from the agreement without any liability to Twitter.

A possible disengagement

So why is he claiming he could cancel the deal?

This could be to push Twitter to lower its price. “It’s probably a negotiation tactic on behalf of Elon,” Toni Sacconaghi, senior research analyst at Bernstein, said Friday. CNBC“Squawkbox”. “The market has gone down a lot. It probably uses the appearance of real active users as a trading ploy.

If he goes ahead with the cancellation of the deal, he is bound to face serious damage to his reputation that would make companies in the future unsure of selling to him and even doing business with him. This is an option that does not suit the billionaire entrepreneur!