American billionaire iconoclast Elon Musk accuses the social network Twitter of withholding information on fake accounts and spam.
In a letter addressed to the legal manager of Twitter and published on the site of the American authority of the financial markets, Elon Musk says Twitter’s lack of information about fake accounts and spam is a clear breach of the social network’s obligations under its estimated $44 billion takeover bid filed last April. For several weeks, the CEO of Telsa and SpaceX has wanted to ensure that bots represent less than 5% of Twitter users as specified in numerous public documents when he estimates that fake accounts represent at least 20% of all users.
Musk’s letter to the SEC, via lawyers:
“Mr. Musk reserves all rights resulting therefrom, including his right not to consummate the transaction and his right to terminate the merger agreement.” https://t.co/rtTA6xYBqI pic.twitter.com/BLPbFBGCkf— The Recount (@therecount) June 6, 2022
In a statement, Twitter said it “has and will continue to share information cooperatively” with Elon Musk. The Parag Agrawal-led company also said it believes the transaction is in the best interests of all shareholders and that it intends to “complete the transaction and implement the merger agreement at agreed prices and conditions”. Shares of Twitter fell 1.49%, deepening doubts that Elon Musk could complete his $54.20 per share offer and further widening the gap between market expectations and the price offered by the billionaire. Shares have barely – and only briefly – topped $50 since Elon Musk launched his buyout plan.
Can Twitter Really Escape Elon Musk?
Twitter’s proposed takeover includes a $1 billion severance fee for each party, but Elon Musk can’t just walk away by paying that charge. The merger agreement includes a specific enforcement clause that allows Twitter to force Elon Musk to enter into the deal, according to the original filing. This could mean that, should the matter end up in court, Twitter could obtain an order compelling the billionaire to complete the merger rather than seeking monetary compensation for any breaches of it.
Inquiries about the bots have led analysts to suspect he is using them as a negotiating tactic to drive the price down as tech stocks have fallen in recent weeks, or to pull out of the deal altogether. Elon Musk’s attorney, Mike Ringler of Skadden, Arps, Slate, Meagher & Flom, said Twitter needed to cooperate by providing the requested data so his client could secure the debt financing needed to close the deal. operation.