By Nickie Louise
Elon Musk’s $44 billion buyout deal to acquire Twitter appears to be in jeopardy because of his inability to verify social media’s claims about fake accounts and spam bots.
According to a report from the Washington Post, Musk said he currently doesn’t have enough information to determine the level of fake accounts, which may force the billionaire to walk away from the deal altogether.
As we reported back in early June, Twitter agreed to comply with Elon Musk’s bot data demands. But Musk claimed Twitter’s spam accounts are not verifiable, even after Twitter gave in to Musk’s demands to provide info on hundreds of millions of daily tweets.
Early Thursday, Twitter, perhaps anticipating the Musk news, had a call with some members of the media outlets in which the social media giant said it removed 1 million spam accounts a day. During the meeting, Twitter also maintained that fake user accounts only represent less than 5% of its total user base, confirming what the company had said earlier in its quarterly earnings.
Musk warned back in early June that he might walk away from the $44 billion takeover deal to acquire the company if Twitter fails to provide the data on the bot, spam, and fake accounts that he requested. In the letter to Twitter Chief Legal Officer Vijaya Gadde, Skadden attorney Mike Ringler for Musk said that “Mr. Musk reserves all rights resulting therefrom, including his right not to consummate the transaction and his right to terminate the merger agreement,” according to CNBC.
On April 25, Twitter agreed to sell the company to Elon Musk for $44 billion. Under the terms of the agreement, Twitter stockholders will receive $54.20 in cash for each share of Twitter common stock that they own upon closing the proposed transaction.
The purchase price represents a 38% premium to Twitter’s closing stock price on April 1, 2022, which was the last trading day before Mr. Musk disclosed his approximately 9% stake in Twitter. Musk needed to use his Tesla stock to raise $21 billion in equity to fund his takeover of the social media giant.
Under the terms of the agreement, Twitter stockholders will receive $54.20 in cash for each share of Twitter common stock that they own upon closing the proposed transaction. The purchase price represents a 38% premium to Twitter’s closing stock price on April 1, 2022, which was the last trading day before Mr. Musk disclosed his approximately 9% stake in Twitter.
