Elon Musk is abandoning his bid to purchase Twitter today (July 8), sending a letter to the social media company’s board citing the lack of clarity around the number of so-called bot accounts on the site.
Musk, who offered to pay $44 billion for the site, has held up the issue of the bot accounts as a sticking point for months. In the letter, his legal advisors claim Twitter has not been forthcoming about how accounts on the site are illegitimate:
“Twitter has failed or refused to provide this information. Sometimes Twitter has ignored Mr. Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr. Musk incomplete or unusable information.”
Musk, the CEO of Tesla and the world’s wealthiest person, launched his takeover bid in April, after first buying 9.2 percent of Twitter’s shares, then offering to buy them all. An active Twitter user, Musk has grumbled about the platform’s content restrictions and his bid was cheered on by conservatives—who claim they are being censored by the site—after he promised to do away with most of them. The Twitter board agreed to the sale April 25.
But early on he began to show signs of buyer’s remorse, and repeatedly raised the issue of spam accounts as a stumbling block. With the bulk of his wealth tied up in Tesla shares that have plummeted in value, it’s possible Musk simply didn’t feel controlling his favorite social media site was worth the cost.
The merger agreement calls for Musk to pay $1 billion to Twitter in the event the deal can’t close for regulatory or other unanticipated reasons, and it’s possible Twitter could sue Musk for a greater sum for scuttling he deal. However, since Musk’s letter today argues that Twitter is responsible for violating the merger agreement, it’s unlikely he will voluntarily pay the $1 billion, and the matter could soon end up in litigation.