Billionaire entrepreneur Elon Musk on Monday accused Twitter of “resisting and thwarting” his right to information about fake accounts active on its platform, calling it a “clear material breach” of the terms of their merger agreement.
Musk warned that he may walk away from the Twitter deal if the social media company fails to provide data on spam and fake accounts currently active on its platform.
A letter written to Twitter said, “Mr Musk reserves all rights resulting therefrom, including his right not to consummate the transaction and his right to terminate the merger agreement.”
The letter further stated that the merger agreement requires Twitter to provide the data Musk requested and opposed the company’s alleged claim that it is only required to provide information for the limited purpose of helping to close the transaction.
“To the contrary, Mr. Musk is entitled to seek, and Twitter is obligated to provide, information and data for, inter alia, ‘any reasonable business purpose related to the consummation of the transaction,’” the letter said.
“At this point, Mr. Musk believes Twitter is transparently refusing to comply with its obligations under the merger agreement, which is causing further suspicion that the company is withholding the requested data due to concern for what Mr. Musk’s own analysis of that data will uncover,” it further added.
As per reports, the letter says Musk would agree to ensure anyone reviewing the data, which would be bound by a non-disclosure agreement, and that he would not use any “competitively sensitive information” if the deal doesn’t close.
Earlier last month, Musk had tweeted that his deal with Twitter won’t move forward until he had more information about the number of fake accounts active on the service. On Friday (May 13), Tesla CEO Elon Musk announced that the 44 billion dollar Twitter deal has been temporarily put on hold, subject to the estimate that less than 5% of users on the micro-blogging platform are spam/fake accounts. For some observers, the move was a part of Musk’s negotiation tactic to lower the price of the $44 billion deal.
He stated that his team would do a random sampling to calculate the number of fake accounts, but Twitter’s CEO later explained that nonpublic information would be necessary to get an accurate measure of fake accounts active on the service. However, Twitter executives were quoted as telling their staff that there was “no such thing” as putting the deal on hold as Musk claimed.
