Tesla CEO Elon Musk is threatening to walk away from his deal with Twitter over the social media company’s refusal to provide more information about how many accounts are fake or spam.
Twitter CEO Parag Agrawal insists that less than 5 percent of the company’s 229 million accounts are bots, but Musk wants the underlying data so he can verify whether that’s accurate.
Musk’s $44 billion deal with Twitter includes a billion-dollar breakup fee, which Musk’s attorneys appear to be challenging, pointing to a “material breach” of the agreement.
Musk’s lawyers wrote in the letter that Twitter has offered only to provide details about the company’s testing methods. But they contend that’s “tantamount to refusing Mr. Musk’s data requests,” and constitutes a “material breach” of the merger agreement that gives Musk the right to scrap the deal if he chooses.
“This is a clear material breach of Twitter’s obligations under the merger agreement and Mr. Musk reserves all rights resulting therefrom, including his right not to consummate the transaction and his right to terminate the merger agreement,” the letter says. (AP)
BREAKING: Elon Musk is threatening to end his $44 billion agreement to buy Twitter, accusing the company of refusing to give him information about spam bot accounts. https://t.co/UsuX2k03ph
— The Associated Press (@AP) June 6, 2022
Twitter says they’ve cooperated “in accordance with the terms of the merger agreement” and expressed their interest in seeing the deal through.
“We intend to close the transaction and enforce the merger agreement at the agreed price and terms,” the company said.
Last month, Musk said he was putting the deal temporarily on hold over the issue with bots.
Boston College Brian Quinn told the AP Musk’s letter from his attorneys shows he is “looking for a way out of the deal or something that will get leverage for a renegotiation of the price.”
“I doubt he would be allowed to walk away,” Quinn added. “At some point, the board of Twitter will tire of this and file a suit.”