Elon Musk quits Twitter deal, because the company is 'actively resisting' his efforts to study fake accounts.
The Tesla CEO said in a filing Friday afternoon that he believed Twitter was in material breach of multiple provisions of the April 25 sale agreement — including Musk’s request that the company share information about the number of fake and spam accounts on the social media platform.
Unsatisfied with Twitter's own figures (the company has said bots and other false accounts make up less than 5% of its active users), the Tesla and SpaceX CEO has sought data from the social network to conduct his own analysis. He says the company has refused, accusing it of violating their original agreement, in which he waived the usual due diligence that usually accompanies such buyouts.
Earlier this week, Musk's Twitter buyout was reported to be in "serious jeopardy" as negotiations dragged on. Now it has been canceled entirely.
"Mr. Musk believes the company is actively resisting and thwarting his information rights (and the company's corresponding obligations) under the merger agreement," the letter said. "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."
Musk said the alleged stonewalling gives him the right to walk away from the deal entirely.
The fallout from the deal is apt to be significant, though the consequences remain unclear for now. One way or another, Twitter will remain public.
Comments