Elon Musk accuses Twitter of 'resisting and thwarting' his request for more bot stats
Elon Musk's pending acquisition of Twitter continues to be in question as he looks for more information on bots.
There have been a couple factors stalling Elon Musk’s pending acquisition of Twitter (TWTR). Although his proposal was approved by the board, Musk has been awaiting more information about the amount of bots on Twitter before moving forward to finalize the deal. Now, Musk and his lawyer have sent a letter to Twitter, in which they accuse the company of “resisting and thwarting” Musk’s information rights.
The letter sent to Twitter from Elon Musk and his lawyer was published to the SEC website earlier today. In the letter, the party speaks to Twitter’s claims about its bot/spam accounts. While Twitter claims that bots only make up for 5 percent of all profiles, Musk has stated that the number is likely closer to 20 percent. Twitter has neglected to provide sufficient proof as to how they came to such a conclusion. The letter directly addresses Musk’s attempt (and failure) to get to the bottom of the situation.
It’s been a bumpy road for Elon Musk’s acquisition of Twitter (TWTR) to say the least. After Twitter initially accepted Musk’s offer, the billionaire sought additional funding to finance the deal. He then entertained the idea of renegotiating the deal to a lower price, which Twitter leadership pushed back on. Now, the ordeal surrounding Twitter’s bots and spam accounts has delayed the closing of the deal even further, and could ultimately cause it to fall apart.
Donovan Erskine posted a new article, Elon Musk accuses Twitter of 'resisting and thwarting' his request for more bot stats
nevermind, i guess he's trying to to whatever he can to get out of the deal:
But in the merger agreement, there are also covenants, promises that Musk and Twitter make to each other about what they will do going forward, between the signing of the merger agreement and the closing. If Twitter breaches a representation, Musk still has to close unless the breach causes a material adverse effect. 3 But if Twitter breaches a covenant, Musk can walk away: He doesn’t have to close unless Twitter “shall have performed or complied, in all material respects, with its obligations required under this Agreement.” 4 There is no MAE requirement: You just have to comply with the covenants.
The representations are limited to what the merger agreement actually says, but this covenant — the one about furnishing information — is limited only by (1) Musk’s (and his lawyers’) imagination and (2) the somewhat fuzzy standard of “any reasonable business purpose related to the consummation of the transactions.” 8 So Musk can ask Twitter, like, “give me the cell phone numbers of every one of your monetizable daily active users so I can call them and see if they’re bots,” and Twitter will have to decide if that is reasonable, if it violates any laws, etc. If they say no, Musk can disagree, and it might end up in court, with Musk having the ability to walk away if he wins. If they say yes, Musk can just keep asking for more things. “Tell us what all of your users were thinking about last Thursday,” why not.