Billionaire, Elon Musk Says He’s Terminating $44bn Twitter Deal Over Issue Of Fake Accounts

The billionaire founder of Tesla and SpaceX, Elon Musk said he is terminating his $44 billion Twitter deal because the social media company failed to provide information about fake accounts on the platform.

 Elon Musk had offered to buy Twitter for $43bn, describing the offer as “best and final”, saying that he wanted to transform the social media platform into a private company.

In a statement on April 25, Twitter confirmed it had entered into a definitive agreement to be acquired by Musk, for $54.20 per share in cash in a transaction valued at approximately $44 billion.

Upon completion of the transaction, Twitter will become a privately held company.

Musk has notified now Twitter that he intends to terminate his agreement to buy the social media platform for $44bn, accusing it of disclosing “false and misleading” information about the number of fake and spam accounts.

In a filing on Friday, July 8, lawyers for the Tesla chief executive claimed Twitter was “in material breach of multiple provisions” of the sale agreement, and “appear[ed] to have made false and misleading representations”.

The number of spam and fake accounts on the platform was “wildly higher” than the 5 percent estimated by Twitter, according to preliminary analysis by Musk’s advisers, the filing stated.

“Sometimes Twitter has ignored Mr. Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr. Musk incomplete or unusable information,” the filing reads.

“Twitter is in material breach of multiple provisions of that Agreement, appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement,” it also said.

Spam accounts are designed to spread information to large numbers of people and manipulate the way they interact with the platform. On Thursday, Twitter said it removed around 1 million spam accounts each day.

Mr Musk believes that bots could account for 20% or more of Twitter users.

Elon Musk has for weeks been trying to get information about how many daily active users Twitter has.

Twitter has a problem with bots. In fact only yesterday it said it removed a million spam accounts a day.

In the filing, Mr Musk said he’d repeatedly been refused information about the number of bot accounts on Twitter – which is why he wished to terminate the deal.

Separately, according to the filing, Musk is considering whether Twitter’s “declining business prospects” and worsening financial outlook violate the agreement.

The filing also accused Twitter of failing to comply with its obligation to “conduct its business in the ordinary course” after chief executive Parag Agrawal imposed a recruitment freeze, fired two senior members of staff and this week announced that the company was laying off a third of its talent acquisition team.

The company’s chairman, Bret Taylor, tweeted on Friday evening that, “the Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement”.

The terms of the deal require Musk, the CEO of Tesla, to pay a $1bn break-up fee if he does not complete the transaction.

The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery.

— Bret Taylor (@btaylor) July 8, 2022

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Posted: at 9-07-2022 04:00 PM (1 year ago) | Addicted Hero

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Posted: at 26-08-2022 10:37 PM (1 year ago) | Newbie