Tesla’s billionaire owner is contemplating withdrawing from the $44 billion deal as he spars with Twitter over its refusal to provide further information on spam and fake accounts.
This is a transparent material breach of Twitter’s obligations under the merger agreement. According to the letter filed Monday with the Securities and Exchange Commission (SEC), Elon Musk reserves all rights, including the right not to complete the transaction and terminate the merger agreement.
Musk’s attorneys contend that Twitter has not completed the merger agreement’s conditions, which allows Musk to demand Twitter give any legitimate business purpose relevant to the deal’s consummation.
According to the letter, Twitter has only disclosed little information on its users, and its “latest offer” contains only details about the company’s testing methodologies.
Twitter failed to support its claims that bots and fake accounts account for less than 5% of its active user base. On May 13, the Tesla CEO said that he was putting the deal on hold while trying to detect if spam/fake accounts represent less than 5% of Twitter users.
Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of usershttps://t.co/Y2t0QMuuyn
— Elon Musk (@elonmusk) May 13, 2022
“At this point, Mr. Musk believes Twitter is transparently refusing to comply with its obligations under the merger agreement, which is causing further suspicion that the company is withholding the requested data due to concern for what Mr. Musk’s own analysis of that data will uncover,” the letter also says.
