Elon Musk is considering withdrawing the offer to buy Twitter after accusing the social network of hiding key information about the company.
The tycoon issued an ultimatum in a letter to Twitter’s chief legal officer, in which his lawyers stated that not providing more details about bots and fake accounts is a “clear material breach” of the purchase agreement.
A story published by the Wall Street Journal revealed that Musk believes Twitter is frustrating his reporting rights and the company’s obligations under the merger agreement.
“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,” it reads.
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Musk has decided to halt the purchase of Twitter by requiring the company to share a detailed report on the number of fake accounts on the platform, as it is a priority for him to crack down on bots that are capable of disrupting public conversation or even starring in scams.
So far there is no exact figure; however, according to Parag Agrawal, CEO of the company, the amount amounts to 5% of total accounts, but Musk claims it is more than 20%.
In the meantime, Musk has so far raised $33 billion in cash to make the purchase, with $11 billion to go. It is known that he is in discussions with Twitter founder and former CEO Jack Dorsey and others to help fund or roll over his shares in order to complete the deal.
While this is going on, Twitter shares were down 6%, well below the $54.20 offer price of Musk’s per-share bid.
Government gives Elon Musk the green light to buy Twitter
Last Friday, June 3, Twitter announced that the antitrust waiting period established by the country’s legislation to go ahead with the purchase has expired, so the way is clear to go ahead with the transaction.
According to the legislation, agreements of this type are first reported to the government for review by the Department of Justice or the Federal Trade Commission; as neither of the two agencies submitted a “second request” for documents, the purchase could go ahead.