Billionaire investor and entrepreneur Elon Musk is apparently seeking to drop his highly publicized bid to take over Twitter, but critics are poking holes in his reasoning for doing so.
According to reports, Musk has stated that he cannot move forward with his $44 billion offer to purchase the wildly influential social media platform Twitter “unless the social media giant can prove bots make up fewer than 5% of its users,” which he has claimed was one of the reasons he sought to purchase the platform in the first place. In a response to a filing from Twitter Inc. with the SEC that spambots represent less than 5% of Twitter users, Musk clarified his position on Twitter, writing: “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.”
Twitter’s CEO, Parag Agrawal, had posted a lengthy thread about spam on the platform on Monday (May 16th), stating that Twitter’s accounting of spambots was based on “multiple human reviews (in replicate) of thousands of accounts.” The SpaceX and Tesla founder responded to the thread succinctly with a poop emoji. Musk’s behavior, coupled with the wild fluctuation in the stock market in response to the back-and-forth of the negotiations, has led many to speculate that Musk is now trying to back out of the deal.
One of those observers, Bloomberg Opinion writer Matt Levine wrote in a piece published on Tuesday (May 17th) that “Musk is lying”. “More important, nothing has changed about the bot problem since Musk signed the merger agreement. Twitter has published the same qualified estimate — that fewer than 5% of monetizable accounts are fake — for the last eight years,” writes Levine. “Musk knew those estimates, and declined to do any nonpublic due diligence before signing the merger agreement.”
He also points out that Musk’s antics are attempts to renegotiate the price of the deal due to tech stocks dramatically dropping in recent weeks, including Tesla’s which Musk was relying on to finance a significant part of his bid to buy Twitter. Levine closes by stating that Twitter’s best move in the midst of the controversy is to sit tight and let Musk continue acting out until he’s ready to commit to finalizing the deal. By outside accounts, the investor has not filed any formal notice that he is withdrawing his bid.