The CEO of Tesla and largest shareholder of Twitter, Elon Musk is still seeking more data on the streaming platform’s spam bots. Elon Musk claims Twitter is in “clear material breach” of their $44 billion acquisition agreement and threatens to “terminate” the agreement as a result.
Musk’s legal team alleges in a letter issued to Twitter this morning that Twitter has neglected to provide him with information on the service’s spam bot problem, and that he is entitled to that information under the transaction agreement.
The billionaire feels the company is actively opposing and undermining his information rights (and the company’s related obligations) under the merger agreement, Musk’s lawyers wrote. According to the letter, Musk may opt not to execute the deal due to the claimed violation of the contract.
Musk has spent weeks on Twitter complaining about the spam bot problem in what appears to be an odd attempt to get out of a deal he made just over a month ago. The CEO previously stated that the transaction was “on hold” owing to his concerns about bots, and that it “cannot move forward” unless Twitter demonstrates the accuracy of its spam statistics.
However, it was not until today that Musk issued an explicit threat to pull out of the transaction, with most of his previous criticisms coming in the form of tweets and interviews. According to Wedbush Securities analyst Daniel Ives, the letter shows Musk is seeking to walk away from [the] agreement.
For years, Twitter has published its bot estimates to the US Securities and Exchange Commission, while also warning that its estimate may be too low.
According to Twitter, Musk indicated last month that he wanted to suspend the purchase transaction to check that fraudulent or spam accounts comprised less than 5% of the company’s 229 million users during the first quarter.
If Twitter’s reporting is correct, there are fewer than 11.4 million bogus accounts that are targeted for ads. The billionaire stated that he and his staff intended to perform their own audit of 100 Twitter followers to determine how many are bots or spam accounts.
The billionaire appears to believe that bots are an issue for the majority of other Twitter users, as well as advertisers that place advertising on the network based on the number of real people they anticipate reaching.
