It appears that Elon Musk might pull the plug on his $44 billion Twitter (NYSE: TWTR) acquisition, after the entrepreneur raised concerns about the social media platform’s accuracy of spam account data.
Musk took to twitter to renew his assertion that there are far more than the 5% of fake twitter accounts the social media company estimates. According to the Tesla CEO, spam accounts likely make up more than 20% of all twitter users, and as such, the planned acquisition “cannot move forward” until twitter presents more accurate statistics.
“20% fake/spam accounts, while 4 times what Twitter claims, could be *much* higher,” he tweeted. “My offer was based on Twitter’s SEC filings being accurate. Yesterday, Twitter’s CEO publicly refused to show proof of <5%. This deal cannot move forward until he does.”
Musk echoed similar sentiment during a Miami tech conference on Monday, once again suggesting that bots account for at least 20% of all twitter accounts. “Currently what I’m being told is that there’s just no way to know the number of bots,” he said, as cited by Bloomberg at the time. “It’s like, as unknowable as the human soul.” Musk’s latest comments come after the billionaire last week hinted that the $44 billion twitter deal was put “temporarily on hold” pending additional details surrounding the number of reported spam accounts.
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The entrepreneur attempted to extract more information on the statistics via a public spat with twitter CEO Parag Agrawal on Monday. The Twitter exec provided insights into the number of spam accounts suspended every day, and modest details outlining how the company identifies them. However, Agrawal asserted that specific estimations cannot be conducted externally because private user information cannot be shared. Musk, in response, tweeted the turd emoji. “So how do advertisers know what they’re getting for their money?” The Tesla CEO probed. “This is fundamental to the financial health of Twitter.”
However, Musk’s comments have given rise to speculation that he might be using the inconsistent spam account figures as a method to negotiate a lower purchase price. During the Miami conference, the Tesla CEO said that a reduced price point for the twitter acquisition is not “out of the question.”
Musk has also posted a poll on Twitter as of this afternoon, poking fun at just how many bots may be present on the platform. After one user responded with commentary suggesting the SEC should investigate, Musk took a shot at the Securities and Exchange Commission, stating, “Hello @SECGov, anyone home?” Which is rather rich, considering Musk’s history with the regulatory.
The tech billionaire in January embarked on a shopping spree of twitter shares before disclosing his 9.2% stake in April. Later that month, Twitter’s board of directors accepted Musk’s $44 billion offer to take the company private, but shares of the social media giant have substantially fallen since the announcement, and the deal is still months away from closing.
While this is all well and good, from the other perspective, it should be stated that Musk prior to making the initial offer was well aware of just how many bots may be present on the platform. In April, he notably stated publicly on the platform, “If our twitter bid succeeds, we will defeat the spam bots or die trying!” This of course suggests instead that he’s either looking for a way to back out of the deal, or simply obtain a better price – despite a definitive agreement already having been agreed to.
Information for this briefing was found via twitter and Bloomberg. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
