In a Monday morning correspondence to Elon Musk, the Securities and Exchange Commission filed by the company on Monday morning, Musk warned that he would not accept his deal for Twitter worth $44 billion. He also accused Twitter of breaking their merger agreement in refusing to conduct an external analysis of the amount of accounts it has.
Here are some key facts
In a letter addressed to Twitter’s top lawyer Vijaya Gadde, Musk’s lawyers said on the billionaire’s behalf he required more information on the presence of “bots” on Twitter – or else Musk reserves his “right not to consummate the transaction and his right to terminate the merger agreement.”
Twitter’s shares dropped by 4.1% to $38.55 in morning trading Monday.
Twitter didn’t immediately reply SME’ request for comment.
The Key Background
Monday’s letter is merely the latest threat from Musk related to bots. Musk wrote to Twitter weeks after he accepted Twitter’s invitation to make the company private. tweeted May 13 his deal to buy Twitter was “temporarily on hold” over his skepticism of the company’s estimates of how many bots are on the site, though Musk said at the time he remained “committed to the acquisition.” Twitter CEO Parag Agrawal said in a May 16 tweet the company doesn’t believe an external analysis is possible, to which Musk responded with a poop emoji. According to Forbes, Musk has the highest wealth in the world. SME’ calculations, worth $221.6 billion.
It is less than 5%. That’s the proportion of Twitter accounts that are fake or spam, according to the company’s SEC filings last month.
“At this point, Mr. Musk believes Twitter is transparently refusing to comply with its obligations under the merger agreement, which is causing further suspicion that the company is withholding the requested data due to concern for what Mr. Musk’s own analysis of that data will uncover,” the letter said.
Dan Ives, Wedbush analyst tweeted Monday the letter is the latest evidence Musk is “looking to walk away from deal,” echoing prior analysis that the billionaire is using the issue as a way to walk back on his offer.
Musk Responds to Twitter Statement that it is impossible for external bots analysis (emoji)SME)
Elon Musk’s Bot Problem on Twitter Is Extraordinary (Wall Street Journal)