Musk threatens to walk away from Twitter deal

STORY: Elon Musk threatened to throw away his $44 billion deal to buy Twitter on Monday, telling the social media network in a letter that if it does not hand over sufficient data on spam and fake accounts, then the deal's off.

The letter sent by Musk's lawyer said Twitter was in a "clear material breach" of its obligations and that the Tesla CEO reserves all rights to terminate the deal.

The letter also said Musk suspected Twitter was dancing around the issue of fake accounts, saying:

"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."

Musk's lawyer said the billionaire was "clearly entitled" to the data, in part so that he can facilitate the financing of the deal.

Musk waived the detailed due diligence that buyers typically do on takeover targets when he agreed to buy Twitter in April, in an effort to get the deal done.

In May, Musk tweeted that he would put the deal "temporarily on hold," while he waits for Twitter to provide the data on spam and fake accounts, which he has claimed must represent at least 20% of its user base. Twitter has said the number is less than 5%.

The world's richest man is contractually obligated to pay Twitter a $1 billion break-up fee if he does not complete the deal. But the contract also contains a "specific performance" clause that a judge can cite to force Musk to complete the deal.

Twitter shares fell as much as 5.5% in early trading but recovered some ground by midday.

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