Elon Musk accuses Twitter of violating the agreement, threatens not to buy anymore

In a six-paragraph letter to Twitter on June 6, Elon Musk’s lawyer clarified the billionaire’s stance. This is considered the most direct threat to the “blue bird” social network. Musk’s side publicly alleges Twitter violated the merger agreement by not providing the spam and fake account data he requested.

CEO Elon Musk

The letter mentioned that Twitter “actively opposes and obstructs the right to information” of Musk. “This is a clear and serious breach of Twitter’s obligations under the merger agreement, and Mr. Musk reserves all rights thereto, including the right not to complete the transaction and the right to cancel the merger.” , wrote the representative lawyer.

Musk asked Twitter to provide information on methods of evaluating spam and fake accounts, which proved they account for less than 5% of active users on the platform. He also called for an independent investigation based on Twitter data.

Twitter shares fell 1.5% in trading on June 6, ending the session at $39.56. Even before the latest developments, its price was well below Musk’s $54.20 per share offer, fueling speculation about a possible closing.

Twitter CEO Parag Agrawal defended the company’s calculation. In a statement issued on the same day, Twitter confirmed that it has and will continue to work with Musk to share information to complete the transaction, in accordance with the terms of the merger agreement. The company still intends to “execute the agreement according to the agreed terms and rates”.

According to Musk, the actual number of Twitter spam accounts is much larger, even up to 90%. Earlier, the Tesla boss said the acquisition could not progress until Twitter provided evidence of spam data. Some Wall Street analysts see this as a “trick” of Musk to pressure Twitter to renegotiate the price. From the outset, there were questions about where Musk would get the money for the Twitter takeover.

In separate stock filings, Twitter reveals Elon Musk abandoned an appraisal clause in the transaction, making it easier for him to back out of the deal. If he doesn’t, he will face lawsuits and more difficult situations.

When he agreed to buy Twitter in April, Musk said he wanted to make the public company private, allow free speech on the platform and improve features. However, since then, the stock market has continuously declined due to fears of inflation, war and supply chains. The incident caused shares of companies like Tesla to be severely affected.

The deal is expected to close on October 24. If it cannot be completed, both parties can leave. If the deal is delayed by regulatory requirements, Musk and Twitter have six more months to complete. The terms include a $1 billion fee for each party to waive.

Du Lam (According to CNN, NYT)