Bot controversy: Musk threatens to exit Twitter deal

corporate takeover

First Elon Musk put pressure on Twitter until the service agreed to a deal – but after falling share prices, the enthusiasm of the tech billionaire cooled. Now he is threatening to get out of the deal.

From dpa June 7, 2022 at 3:00 am

There is a dispute over the planned takeover of Twitter by Elon Musk.

Photo: DPA

San Francisco (AP) – Tech billionaire Elon Musk is stepping up efforts to keep the way open for an exit from the deal to take over Twitter.

In a letter from his lawyers to Twitter’s chief legal officer, Vijaya Gadde, it is said that the company refused to provide him with data for his own research into the number of spam and fake accounts. This is a violation of the takeover agreement. That’s why he reserves the right to withdraw from the deal.

Musk has been trying since mid-May to address Twitter’s allegedly false estimates of the number of spam and fake accounts. He therefore already declared the takeover deal to be suspended. From Twitter’s point of view, however, Musk cannot unilaterally put the agreement on hold.

Twitter wants to continue to enforce the deal

On Monday, too, the company emphasized in a statement in the Wall Street Journal, among others, that it was still determined to push through the takeover on the agreed terms. The question of whether Musk’s allegations give him sufficient reason to withdraw from the deal could ultimately be decided in court.

Musk offered Twitter shareholders $54.20 per share. The course of the online service has already come under pressure after his statements in the past few weeks and fell by 1.49 percent to $39.56 on Monday after the exit threat. In a first reaction, the minus was even higher at over six percent.

Kontroverse um Fake-Accounts

Twitter itself estimates that fake accounts make up less than five percent of its user base. The company speaks of 229 million daily users that the service can reach with its advertising. The fake accounts identified by Twitter have already been deducted.

Twitter CEO Parag Agrawal also pointed out that the service blocks more than half a million spam accounts every day — mostly before users see them. Estimates of the number of fake accounts from outside the company cannot be made seriously, he warned.

Musk’s lawyers wrote in their letter published on Monday that under the terms of the takeover deal, Twitter is required to provide data and information that Musk is requesting in relation to the transaction. Contrary to what is shown by Twitter, this obligation to provide information does not only apply to very limited purposes, they argued.

support from Texas

Musk was backed by Texas Attorney General Ken Paxton, who announced an investigation into Twitter’s claims about the number of fake accounts. The company has now been asked to provide information on this within three weeks. Republican Paxton has long been at odds with Twitter and other online platforms. He accuses them of suppressing conservative views.

A Texas law promoted by Paxton prohibited the online services from taking action against any user’s expression of opinion. A side effect of this would be that the platforms cannot remove hate speech, for example. The law was suspended by the US Supreme Court.

Musk relocated the headquarters of Tesla, the electric car manufacturer he runs, from California to Texas and recently announced that he would vote for the Republicans in future elections.

© dpa-infocom, dpa:220606-99-565719/3