Elon Musk claims that Twitter’s lack of information on bots violates the merger agreement
As per the news, it claims that Elon Musk says Twitter Inc. is breaking their merger agreement by refusing to comply with his demands for information on spam and phony accounts, adding yet another twist to a takeover story characterized by the billionaires frequent outbursts. According to an additional security filing on Monday, Musk continues to claim that Twitter is “actively obstructing” and “thwarting his information rights” by refusing to divulge the information. Last month, Musk indicated that he would not proceed with his $44 billion acquisition of Twitter until the social media giant can demonstrate that bots account for less than 5% of its users, as stated in public filings. According to Musk, fraudulent accounts represent for at least 20% of all users.
On the hand, Twitter said in a statement that stated they are continuing to share information with Mr. Musk to complete the acquisition by the merger agreement’s conditions. The firm stated that it believes the transaction is in the best interests of all shareholders and that it wants to complete the acquisition and enforce the merger agreement at the agreed-upon price and terms. Elon Musk strongly disagreed with Twitter’s evaluation of bots in a Monday filing.
Furthermore, Elon feels the company’s refusal to offer more information is a clear substantial breach of Twitter’s responsibilities under the merger agreement, and he reserves all rights arising from it, including the right to terminate the merger agreement and not complete the acquisition. The potential acquisition includes a $1 billion termination fee for each side, but Musk won’t be able to just pay the sum and walk away.
We also came to know that as per the initial statement, the merger contract includes a particular performance term that empowers Twitter to compel Musk to complete the deal. That means that, if the agreement goes to court, Twitter may be able to get an order requiring Musk to finish the merger rather than monetary damages for any violations. Analysts believe his concerns concerning bots are a negotiation technique to lower the price, as tech stocks have fallen in recent weeks, or to run away from the transaction entirely.
