Elon Musk says he is no longer buying Twitter. In a letter sent by a lawyer on his behalf (initially reported by Reuters), Musk claims to have terminated his $44 billion acquisition of the social media company after it failed to comply to multiple provisions within their initial agreement, at least one of which being information on how many bots are on the platform.
After the letter was sent, shares of Twitter tumbled six percent in extended trading.
Bots remained one of Musk’s biggest concerns during his efforts of trying to acquire the platform. He placed a hold on his acquisition after requesting proof that less than five percent of total users were bots. In response, Twitter claimed to have provided the data Musk was requesting, but the Tesla founder was reportedly not happy about what he received. The Washington Post reported that his deal was in peril because of this on Thursday.
According to the letter, the data Twitter provided “has come with strings attached, use limitations or other artificial formatting features,” which rendered it “minimally useful.”
“Twitter is in material breach of multiple provisions of that Agreement, appears to have made false and misleading representations upon which Mr. Musk relied when entering into the Merger Agreement,” the letter continued.
However, as The Verge points out, Musk must prove that Twitter is in the wrong here in order for the acquisition to actually crumble. If Musk is indeed correct that the social media company has breached the agreement, it will be forced to pay a $1 billion breakup fee, as per a provision in the filing. It would also mean Twitter would lose a deal that significantly overvalues the company at $54.20 a share, nearly $20 more than the $36.81 the platform closed at today.
I would like to remind you all that this is still Elon Musk we’re talking about here, which means anything could happen at any given moment. Twitter could wind up providing the information Musk wants and the deal will move on, or things could continue to fall apart like they are now. Right now, it seems like Musk is using some of his leverage to get exactly what he wants, so we’ll have to wait and see what his next move winds up being.