News reports Associated Press Agency. The possible refusal of the owner of Tesla and Space X from buying the social network was already moving forward. Twitter shares tumbled Thursday after a Washington Post report that Musk’s $44 billion deal to buy the social network was in jeopardy.
The richest man in the world has previously expressed doubts and even hinted that he may refuse the deal, citing concerns about the abundance of fake accounts on the social network.
However, despite Musk’s reservations, pulling out of the deal could mean a €1 billion fine, which is the point of the deal.
Twitter has already said it will sue Elon Musk to enforce the deal to buy the company. “Twitter’s board of directors intends to close the deal at the price and terms agreed with Mr. Musk and plans to take legal action to enforce the merger agreement,” Bret Taylor wrote. “We believe that we will succeed,” said the president of the social network.
In early June, his legal team filed a document with the U.S. Securities and Exchange Commission accusing Twitter of committing a “clear material breach” of its “obligations under the merger agreement,” arguing that “Mr. Musk reserves the right to on non-completion of the transaction and on its right to terminate the merger agreement.
According to the letter, Musk has repeatedly made the request since May 9, a month after he submitted his proposal. The rationale for this request stems from the need to estimate how many of the 229 million accounts on the social network are fake.
magnate already threatened to pull out of the deal in May if she doesn’t have guarantees regarding false invoices. “Yesterday, the CEO of Twitter publicly refused to provide evidence of less than 5% on the platform,” Musk wrote on the same social network. The mogul, with 94 million Twitter followers, commented on his demand to confirm that less than 5% of the social media accounts are fake. “The deal can’t go through until he does,” he added.
In response, Twitter CEO Parag Agrawal said the platform blocks more than half a million accounts that appear to be fake every day, often before they are even seen, and blocks millions of alleged users from accounts that are controlled by the software. Internal analysis shows that less than 5% of active accounts per day on average are classified as “spam,” but those accounts cannot be replicated by third parties due to privacy requirements, Agrawal said.
Musk, who claims that “bots” are a plague on Twitter and that he makes it his priority to get rid of them if he takes control of the platform, responded to Agrawal’s explanation on Twitter with an emoji representing a set of feces.
“So how do advertisers know what they’re getting for their money?” Musk asked in a later post about the need to prove that Twitter users are human. “This is critical to the financial health of Twitter,” he added.
Agrawal insisted that the procedure for counting the number of accounts that are “bots” be transferred to Musk.
Now, lawyers for the billionaire argue that Twitter only offered to provide details of the company’s testing practices, which is “equivalent to denying Mr. Musk’s requests for data.” At the same time, the social network resists the rights that Musk protects in business, to receive the information necessary to finalize it, protects its legal team.
“This is a material breach of Twitter’s obligations under the merger agreement, and Mr. Musk reserves all rights, including the right to not complete the transaction and terminate the merger agreement,” the letter, which AP had access to, said.
At stake will be a clause where Musk reserves the right to withdraw from the agreement if there are “material adverse effects” caused by the company – something defined by any type of change that affects Twitter’s financial or business conditions.
According to an estimate released by software company SparkToro, 19.42% of Twitter accounts are fake or spam, although the company acknowledges that its methodology for identifying bots is likely different from that used by Twitter.
Otherwise, the SparkToro website has a tool that shows that more than 70% of Musk’s followers are fake accounts.
Since the offer, Musk has pledged to rid Twitter of spam, improve user authentication, and make the platform more transparent.
On the same day, Musk announced that his team would randomly select 100 users from official Twitter accounts to see if they were real or not.
Musk, the CEO of SpaceX and Tesla, is currently the richest person on the planet according to Forbes magazine, with an estimated net worth of $230 billion.
