Elon Musk threatened Monday to withdraw his bid to buy Twitter, accusing it of failing to provide data on fake accounts, in the latest twist in the Tesla billionaire’s push to acquire the social network.
Twitter has committed “a clear material breach” of its “obligations under the merger agreement and Mr Musk reserves ... his right not to consummate the transaction,” according to a document filed with securities regulators.
The filing marks an escalation of Musk’s prior statements that have highlighted fake accounts as a threat to his proposed $44 billion deal to take over Twitter.
The mercurial Musk agreed a deal in late April to purchase Twitter.
But the proposed sale has stoked protest from critics who warn his stewardship will embolden hate groups and disinformation campaigns.
US securities regulators have also pressed Musk for an explanation of an apparent delay in reporting his Twitter stock buys.
Musk began making significant noise about fake accounts in mid-May, saying on Twitter he could walk away from the transaction if his concerns were not addressed.
Some observers have seen Musk’s questioning of Twitter bots as a means to end the takeover process, or to pressure Twitter into lowering the price.
Musk’s latest statement on bots signifies he is “looking to walk away from deal,” Wedbush analyst Dan Ives said Monday on Twitter, noting that there is a $1 billion breakup fee in the Twitter-Musk transaction.
“We continue to believe that Elon is playing hard ball... to gain leverage/options to either reduce his offer price or indeed completely walk away if he gets cold feet,” said CFRA Research’s Angelo Zino.
Twitter on Monday defended its responsiveness, and vowed to complete the deal.
“Twitter has and will continue to cooperatively share information with Mr Musk,” a spokesperson said. “We intend to close the transaction and enforce the merger agreement at the agreed price and terms.”