Elon Musk says Twitter is “actively resisting” his efforts to investigate how much of its user base is made up of spam-bots – an ongoing bugaboo that could ultimately be grounds for terminating the proposed sale, according to a letter the Tesla CEO sent to Twitter on Monday morning.
“Based on Twitter’s behavior to date, and the company’s latest correspondence in particular, 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 reads.
Musk is back on adversarial footing with Twitter, the latest in a high-stakes cat-and-mouse game that began earlier this year when he bought what at the time was the largest stake in the company. After initial resistance to his takeover overtures, Twitter agreed to a sale – but Musk has been pumping the brakes ever since over the platform’s bot population.
Musk has said he believes fake accounts make up a far greater percentage of Twitter’s users than the company estimates.
“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.”
The letter was issued by the lawfirm Skadden, Arps, Slate, Meager & Flom on behalf of Musk. In the weeks since Musk assembled the financing for his attempted takeover of Twitter, Musk has repeatedly hammered at the spam-bot issue, saying last month that the sale was “on hold” until he gets more clarity.
The deal was lining up to close later this year, subject to the approval of Twitter stockholders and regulators. Musk has secured $25.5 billion of fully committed debt and margin loan financing and is providing approximately $21.0 billion as an equity commitment.
“As Twitter’s prospective owner, Mr. Musk is clearly entitled to the requested data to enable him to prepare for transitioning Twitter’s business to his ownership and to facilitate his transaction financing,” the letter reads. “To do both, he must have a complete and accurate understanding of the very core of Twitter’s business model — its active user base.”
A message sent to Twitter’s corporate communications account was not immediately returned Monday.