Elon Musk escalated the drama surrounding his $44 billion bid to buy Twitter on Friday, saying in a pre-dawn tweet that the deal was “temporarily on hold” until he could get more details about the amount of spam and fake accounts on the platform, then tweeted two hours later that he was “still committed” to the takeover.
The announcements mark the latest chapter in an unfolding business saga that has raised questions about freedom of expression online and the implications of appointing the world’s richest person to lead one of the most influential social media platforms.
Mr Musk, Tesla’s chief executive, has said ridding the platform of fake accounts, bots and spam would be one of his top priorities after the acquisition. In his tweet, Mr. Musk referred to a May 2 registration request by Twitter, which estimated that less than 5 percent of Twitter users were spam and fake accounts.
Known for his free-spirited and sometimes impulsive business style, Mr. Musk’s comments left many wondering about the future of the deal.
Twitter has few restrictions on signing up for an account, and the company has long struggled with spam and bots. But it was difficult to give an exact figure on the magnitude of the problem. In a May 2 regulatory filing, Twitter said it had estimated that less than 5 percent of its users were fake or spam, a figure it had previously disclosed. Twitter warned that it had applied “considerable judgment” when making the calculation and that its “estimation of fake or spam accounts may not accurately reflect the true number,” language similar to that used in the company’s previous filings.
Mr. Musk’s comments were seen as a tactic to lower the price of the acquisition or as a pretext for eventually withdrawing altogether.
“Many will see this as Musk using these Twitter/spam accounts as a way out of this deal in a rapidly changing market,” Daniel Ives, an analyst at Wedbush, said in a note to investors.
Twitter did not respond to a request for comment.
Mr. Musk’s surprising offer on Twitter has sparked a lot of discussion about the role of a social media platform to monitor what is being said by its users. Twitter has spent years trying to fight hate speech, harassment and other online abuse, but Mr. Musk, who has used the platform in the past to attack and belittle critics, has promised to follow the company’s content moderation policy. relax. On Tuesday, he said he would lift a ban on former President Donald J. Trump.
How Elon Musk’s Twitter Deal Unfolded
A blockbuster deal. Elon Musk, the world’s richest man, put an end to what seemed an unlikely attempt by the famed mercurial billionaire to buy Twitter for about $44 billion. Here’s how the deal unfolded:
Withdrawing from the deal can get messy. The purchase agreement includes a $1 billion fee that Mr Musk would have to pay if he terminated the deal, although it was unclear how such a clause would apply if Mr Musk could prove Twitter’s user numbers were incorrect. If Mr Musk’s debt financing is intact, Twitter could also sue the billionaire to force him to pay the deal.
Mr. Musk has pledged to use his personal fortune to fund the deal for Twitter, a plan that was impacted by a recent drop in stock prices, including Tesla’s. Tesla stock has fallen nearly 30 percent in the past month. Mr. Musk is selling both Tesla stock and them as collateral for personal loans to raise money.
If a deal were to be struck, business challenges on Twitter could force Mr. Musk to get more out of his shares in the electric carmaker to plug potential financial gaps. And any problem at Tesla that caused its stock to fall far enough could lead to clauses in Mr. Musk’s personal loans that would require him to add more collateral, limiting his ability to invest in Twitter.
Tesla stock rose Friday after Mr. Musk’s comments.
Mr. Musk’s offer has created uncertainty within Twitter, a company that is already struggling to add users and generate more revenue. On Thursday, Twitter CEO Parag Agrawal fired two top executives, cut new hires and pledged to cut spending.
