Elon Musk threatens to pull out of $44 billion Twitter deal over fake accounts

Elon Musk has threatened to walk away from his $44 billion acquisition of Twitter, accusing the company of refusing to give him enough information about bots on the platform.

Lawyers for the Tesla CEO made the threat in a letter to Twitter on Monday.

The letter says Mr Musk has repeatedly asked for the information since May 9, about a month after his offer to buy the company, so he could evaluate how many of the company’s 229 million accounts are fake.

Shares of the social media giant slid more than 3% Monday, likely incensing Twitter shareholders who filed a suit against Mr Musk late last month for deflating the price of the stock.

Shares of Twitter are down 23% in the last month.

The lawyers say in the letter that Twitter has offered only to provide details about the company’s methods for determining the number of accounts.

Mr Musk says this does not go anywhere near far enough and wants the underlying data so he can do his own verification of what he says are Twitter’s lax methodologies.

The lawyers say that based on Twitter’s latest correspondence, Mr Musk believes the company is resisting and thwarting his information rights under the April merger agreement.

Last month, Mr Musk said that he was unilaterally placing the deal on hold, which experts said he can’t do and could cost up upwards of a billion dollars.

Twitter CEO Parag Agrawal has said the company has consistently estimated that fewer than 5% of Twitter accounts are fake.

Twitter has disclosed its bot estimates to the US Securities and Exchange Commission for years, while also cautioning that its estimate might be too low.

“If Twitter is confident in its publicised spam estimates, Mr Musk does not understand the company’s reluctance to allow Mr Musk to independently evaluate those estimates,” the letter says, adding that he agrees not to disclose or keep the data.

The bot problem is a longtime fixation for Musk, one of Twitter’s most active celebrity users, whose name and likeness are often mimicked by fake accounts promoting cryptocurrency scams.

Mr Musk appears to think such bots are also a problem for most other Twitter users, as well as advertisers who take out ads on the platform based on how many real people they expect to reach.

The letter contends that Musk is not required to explain his rationale for requesting data or submit to “new conditions the company has attempted to impose on his contractual right to the requested data.”