The planned takeover of Twitter by Elon Musk is in “serious jeopardy”, according to a report, sending shares in the company 4% lower in after-hours trading on Wall Street.
Musk’s team has stopped certain discussions around funding for the $44bn deal, according to a report, citing three people familiar with the matter. The report said Musk had concluded that Twitter’s figures on spam accounts – a bone of contention in the deal – were not verifiable.
On Thursday, April 14th, 2022, the world’s richest man, Elon Musk, with a current net worth of $224 Billion, announced an offer to buy Twitter for $54.20 a share or $44 Billion. On April 25th, the Twitter board of executives accepted the deal.
Why Elon Wants To Buy Twitter In The First Place?
Musk, who also leads Tesla and SpaceX, says Twitter isn’t adhering to principles of free speech and he thinks it would be best if the company became private.
Why Deal Is In Jeopardy Now?
According to the report, Musk’s team thinks it won’t be able to confirm data about the number of fake and spam accounts on Twitter and has stopped certain talks around funding the acquisition.
What Twitter Execs Have To Say About This?
Twitter executives defended their spam policy citing a specialist team and automated processes that weed out 1m fake accounts a day. Moreover, Twitter has stated consistently that fewer than 5% of its daily active users are spam accounts – a figure that Musk doubts openly.
What Do Legal Experts Have To Say About The Situation?
However, the legal experts said the world’s richest man and Tesla CEO will struggle to terminate the deal without a legal battle because Twitter can demand a $1 billion break fee from Musk if he attempts to renege on the agreement.