Elon Musk threatens to end deal with Twitter
Elon Musk, CEO of Tesla is threatening to end his $44 billion deal to acquire Twitter over accusation that the company has refused to give him information on how it calculates the number of fake accounts.
This threat was made by Musk’s Lawyer in a letter to Twitter which was disclosed on a Monday filing with the Securities and Exchange Commission.
According to the letter, Musk has repeatedly requested for more information about how Twitter measures spams and fake accounts on its platform since May 9, and had made it clear to Twitter that he did not align with its method of measuring fake accounts.
“This is a clear material breach of Twitter’s obligation under the merger agreement and Musk reserves all rights resulting therefrom, including his right to consummate the transaction and his right to terminate the merger agreement,” the letter said.
Musk, according to the letter, has expressed dissatisfaction about the process and seeks to conduct his own analysis.
The lawyer stated that based on the Platforms latest communication, the Tesla boss believes the company is resisting and thwarting his right under the terms of his deal to acquire the social media company.
Similarly, the letter stated that Twitter’s previous response to queries from Musk’s team explained that the company’s testing method was “tantamount to refusing the CEO’s data request.
Read also: Elon Musk puts Twitter deal on hold
Meanwhile, Musk disclosed on his official Twitter account in May, that he is temporarily suspending the deal, citing a report released from the platform’s first quarter earnings about the spam bot issue.
“Twitter deal temporarily on hold pending details supporting calculation that spam and fake accounts do indeed represent less than 5 percent of users,” Musk tweeted.
According to the report, spams and false accounts represented fewer than 5 percent of Twitter’s monetized daily active users during the first quarter of 2022.
The microblogging platform disclosed that it had 229 million users who were served advertising in the first quarter.
Meanwhile, this disclosure came days after the CEO inked a deal to buy Twitter at $44 billion, with a major focus on removing spam bots from the platform and fighting against other related misconducts on twitter.
Twitter noted in the filing that it has faced several risks before inking the deal with Musk which includes whether advertisers would continue to spend on twitter and potential uncertainty regarding the future plans and strategy.