Musk Says $44 Billion Deal Hangs on Proof Spambots Account For 5% Or Less of Total Users

Deal put on hold until proof of the number of spambots is provided.

QUICK FACTS:
  • Tesla CEO Elon Musk has put a hold on his purchase of social media platform Twitter until he can get more information about inauthentic accounts.
  • According to Newsmax, Musk says he won’t move forward until Twitter shows proof that spambots make up less than 5% of total users on the platform. 
  • “My offer was based on Twitter’s SEC filings being accurate. Yesterday, Twitter’s CEO publicly refused to show proof of <5% (spam accounts). This deal cannot move forward until he does,” Musk said in a tweet.
  • Twitter confirmed within hours that it was committed to going forward with the deal and the price and terms “as promptly as practicable.”
IMPACT OF TWITTER’S BOT POPULATION NEWS:
  • Twitter’s official estimate is that the bots account for about 5% of their user base.
  • Musk, however, said he suspects they could be as much as 20% of total users on the platform, which poses a problem for the potential purchaser.
  • “You can’t pay the same price for something that is much worse than they claimed,” he said on Monday at the All-In Summit 2022 conference in Miami.
BACKGROUND:
  • A 3% dip in stock prices since Musk’s announcement of his suspicions puts Twitter Inc. stock trading at $36.31, which is significantly lower than the $54.20 per share evaluation used to warrant the $44 billion purchase price.
  • When asked in Miami if he believed that the company could possibly still be purchased at a different price Musk said, “I mean, it is not out of the question. The more questions I ask, the more my concerns grow.”