Elon Musk claims that Twitter is in “clear material breach” of their $44 billion acquisition agreement and that he has the authority to “terminate” the deal. In a letter addressed to Twitter on Monday, Musk’s legal team claims that Twitter has neglected to provide him with information on the service’s spam bot problem, which he is entitled to under the purchase agreement.
According to the attorneys, “Mr. Musk believes that the company is actively resisting and thwarting his information rights (and the company’s corresponding obligations) under the merger agreement. “Because of the alleged violation of the contract, Musk might opt “not to consummate the transaction,” according to the letter.
Elon Musk earlier stated that the acquisition was “on hold”
Musk has spent weeks on Twitter whining about the spam bot problem in what appears to be an odd attempt to get out of a contract he signed just over a month ago. Elon Musk earlier stated that the acquisition was “on hold” owing to his concerns about bots. And that it “cannot move forward” unless Twitter confirms that its spam numbers are accurate.
Elon didn’t make an explicit threat to pull out of the deal until yesterday, with most of his previous criticisms being aired in tweets and interviews. According to Wedbush Securities analyst Daniel Ives, Musk’s letter shows that he is “looking to walk away from [the] deal.”
Brian Poliakoff, a spokesperson for Twitter, said the business has been working with Musk and would continue to do so. Poliakoff stated, “We intend to close the transaction and enforce the merger agreement at the agreed price and terms.”
Spam accounts make up fewer than 5% of Twitter’s daily users, according to estimates. Twitter CEO Parag Agrawal said last month that the business has given Musk an explanation of how the company calculates spam estimates. In mid-May, Agrawal tweeted, “We shared an overview of the estimating process with Elon a week ago. He also said the we look forward to continuing the conversation with him, and all of you.”