Elon Musk has threatened Twitter with definitively canceling its purchase of the company if it does not provide more data about the proportion of bots and false profiles in its mass of users. The tycoon has left this ultimatum in the hands of his lawyers, who have sent a letter on his behalf to the legal director of the social network in which they warn that a refusal to give him more information in this regard may lead to the breach of agreement.
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“Mr. Musk believes that the company is actively resisting and frustrating his information rights (and the corresponding obligations of the company)”, the letter emphasizes, with copy to the US securities regulator. “This is a clear material breach of Twitter’s obligations under the purchase agreement and Mr. Musk reserves all resulting rights, including his right not to consummate the transaction and his right to terminate the agreement.”
The billionaire announced in mid-May that the Twitter purchase process, for which he promised to pay some 40,000 million euros, was “temporarily suspended.” The reason was the same: his distrust in the percentage of false accounts that the social network has. This ensures that the figure does not exceed 5% of the total number of users, although it recognizes that it could be higher since the calculation is based on an estimate.
The number of real users of the platform is key to its value because they are the ones who consume ads and, therefore, the basis of the company’s profitability. Elon Musk has denounced that the percentage of bots on Twitter could be “greater than 20%”, although he has not offered any proof of this beyond the impression that he is a very active user of the social network. The tycoon has asked Twitter to release access to the data in order to carry out an independent verification.
“Mr. Musk believes that Twitter is refusing to honor its obligations under the purchase agreement in a transparent manner, raising further suspicion that the company is withholding the requested data out of concern about what Mr. Musk will discover. with its own analysis of that data, ”explains the letter sent this Monday.
“As the future owner of Twitter, Mr. Musk clearly has a right to the requested data in order to prepare for the transition of the Twitter business to his ownership and to facilitate the financing of the transaction. To do both, he must have a complete and precise understanding of the core of Twitter’s business model: its active user base, ”say the tycoon’s lawyers.
Musk’s Twitter purchase process has been tumultuous from the start. The billionaire first became the largest shareholder of the social network and agreed to be part of its board of directors. Days later he rejected it and launched a hostile takeover bid to acquire 100% of the shares.
Twitter management tried to fight back with a measure known as a “poison pill,” but eventually accepted the offer. With the agreement ratified, Musk began to question the figures of false accounts of the social network, which has caused the company to lose 25% of its value on the stock market. The conflict has reached the point that a group of shareholders has sued the billionaire for knowingly blowing up the price of the shares in what, they denounce, is a premeditated move to buy them at a lower price.