In a letter to Twitter’s head of law, policy and trust, Vijaya Gade, Musk said Twitter was “actively resisting and thwarting its information rights”, as stated in the deal.
“This is a clear breach of Twitter’s obligations under the merger agreement, and Mr. Musk reserves all rights arising therefrom, including his right not to complete the transaction and his right to terminate the merger agreement,” wrote a lawyer representing Musk. to the company. .
Musk asked Twitter to provide information on its testing methodologies to support its claims that bots and fake accounts account for less than 5% of the platform’s active user base, a figure the company has consistently cited for years in the standard public disclosures. Musk also called for his own independent assessment based on Twitter data.
Shares of Twitter fell 5% at the start of trading on Monday. Even before the latest development, Twitter shares were trading well below Musk’s offer to take $ 54.20 a share, which probably shows investors’ skepticism about the deal.
Twitter’s chief executive, Parag Agraval, maintains his company’s long-standing spam rate. In a statement Monday, the company said: “Twitter has and will continue to share information with Mr. Musk to complete the deal in accordance with the terms of the merger agreement.”
The company also said it intends to “close the deal and impose the merger agreement on agreed price and terms”.
Musk claims that the actual number of spam accounts is probably much higher, potentially up to 90%. Musk said earlier that the acquisition “cannot move forward” until the company provides “proof” of its spam rate.
Some Wall Street analysts said the repulsion could be a case of remorse for the buyer and an attempt to pressure Twitter to negotiate a lower price for the $ 44 billion deal. From the beginning, there were questions about how Musk would finance the acquisition. Social media stocks have also hit in recent weeks amid broader market turmoil.
Monday’s letter speculated that Twitter could “withhold the requested data due to concerns about what Mr. Musk’s own analysis of this data would reveal.”
The letter also claims that Twitter has tried to restrict access to information by interpreting the merger agreement closely so that the provision of information does not fall within Twitter’s contractual requirements. But the letter accused that even according to Twitter’s narrow definitions, he still had an obligation to provide the information.
In a separate securities bid, Twitter previously revealed that Musk had waived a due diligence clause in a deal that could make it easier for him to withdraw from the deal; without him, Musk could face a more difficult climb and the prospect of litigation. In concluding the agreement to buy Twitter, Musk turned the platform’s spam bots into a central issue. He vowed to defeat them or “die trying”, although he described Twitter as vital to the “future of civilization”.
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