By John Ikani
Elon Musk has warned he may walk away from his $44 billion deal to acquire Twitter Inc if the social media network fails to provide data on spam and fake accounts, the billionaire said in a letter to the company on Monday.
In the letter to Twitter, the billionaire said he reserved all rights to terminate the merger as the company was in a “clear material breach” of its obligations by not providing him with the information.
Twitter did not immediately respond to a request for comment.
This is the first time Musk has threatened to walk away from the deal in writing as opposed to airing it on Twitter’s social media platform
Twitter Chief Executive Officer, Parag Agrawal has earlier said the number of fake accounts is less than 5% when measuring daily users. The company has also previously cited the figure in its quarterly filings.
Musk has repeatedly criticised Twitter’s claim that less than 5 per cent of its monetisable daily active users are bots, warning last month that his takeover “cannot move forward” unless the platform provides proof.
Mr Musk had previously noted that his priorities included removing “spam bots” from the platform, once describing cryptocurrency spam bots as the platform’s “single most annoying problem.”
Since Musk and Twitter announced the deal in April, shares in Tesla along with high-growth tech companies have fallen sharply. Observers have noted that Musk, because of the market turmoil, may try to find an excuse to reduce the transaction price or walk away altogether.
Twitter had previously disclosed in filings to the regulatory body that Mr Musk had waived a due diligence clause in the deal that could have eased his withdrawal.
In light of this, Mr Musk could either pay a $1 billion breakup fee or would be prosecuted against by Twitter to enforce the terms of the merger agreement and compel him to buy the company.
