Elon Musk threatened to cancel his purchase of Twitter on Monday, accusing the social media platform of breaching the merger agreement by not providing the data he has requested on spam and fake accounts.
Musk alleged in a letter written to Vijaya Gadde, Twitter’s head of legal, policy and trust, that Twitter is “actively resisting and thwarting his information rights” as outlined by the deal. An attorney representing Musk wrote to the company: “This is a clear material breach of Twitter’s obligations under the merger agreement and Mr. Musk reserves all rights resulting therefrom, including his right not to consummate the transaction and his right to terminate the merger agreement.” Musk has demanded that Twitter turn over information about its testing methodologies to support its claims that bots and fake accounts constitute less than 5% of the platform’s active user base. Musk has also alleged that the true number of spam accounts is likely much more, potentially as high as 90%. Musk has previously said the acquisition “cannot move forward” until the company provides “proof” of its spam metric.
Musk’s letter also insinuated that Twitter may be “withholding the requested data due to concern for what Mr. Musk’s own analysis of that data will uncover” and claimed Twitter had ‘sought to restrict access to the information by interpreting the merger agreement narrowly, such that providing the information would fall outside the scope of Twitter’s contractual requirements.’
Twitter’s CEO, Parag Agrawal, said in a statement Monday that “Twitter has and will continue to cooperatively share information with Mr. Musk to consummate the transaction in accordance with the terms of the merger agreement.” The company also said it intends to “close the transaction and enforce the merger agreement at the agreed price and terms.”
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