Elon Musk Isn't Buying Twitter
Elon Musk is trying to end his $44bn (£36bn) deal to buy Twitter, alleging multiple breaches of the agreement. The announcement is the latest turn in a long-running story after the world's richest person decided to buy Twitter in April. Musk said he has backed out because Twitter failed to provide enough information on the number of spam and fake accounts.
Twitter says it plans to pursue legal action and to sue Musk to complete the $44bn merger and to enforce the agreement. The original purchase agreement includes a $1bn (£830m) break-up fee.
The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk, and plans to pursue legal action to enforce the merger agreement. “We are confident we will prevail in the Delaware Court of Chancery." Twitter chairman Bret Taylor wrote in a tweet setting up a potentially long and protracted legal battle between the two sides.
In May, Musk said the deal was "temporarily on hold" as he was waiting for accurate data on the number of fake and spam accounts on Twitter. Musk had asked for evidence to back the company's assertion that spam and bot accounts make up less than 5% of its total users.
In a letter to the US Securities and Exchange Commission (SEC) Musk's lawyer said Twitter had failed or refused to provide this information. “Mr. Musk and his financial advisors at Morgan Stanley have been requesting critical information from Twitter as far back as May 9, 2022, and repeatedly since then, on the relationship between Twitter’s disclosed user figures and the prevalence of false or spam accounts on the platform... If there were ever any doubt as to the nature of these information requests, the May 25 Letter made clear that Mr. Musk’s goal was to understand how many of Twitter’s claimed users were, in fact, fake or spam accounts".
That letter noted that “Items 1.03 to 1.13 of the diligence request list contain high-priority requests for enterprise data and other information intended to enable Mr. Musk and his advisors to make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform…”
The letter then provided Twitter with a detailed list of requests to this effect,” says the letter. "Sometimes Twitter has ignored Mr. Musk's requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr. Musk incomplete or unusable information," the letter reads.
Spam accounts are designed to spread information to large numbers of people and manipulate the way they interact with the platform. Twitter has said it removed around 1 million such accounts each day. Elon Musk clearly believes that spam or bot accounts could account for as many as 20% of Twitter users. Shares in Twitter fell by 7% after the announcement.
SEC: Twitter: BBC: Guardian: Birmingham Mail: STV:
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