Elon Musk Says Twitter ‘Actively Opposes’ Merger Deal Terms, Threatens to Terminate Deal Over Spam Dispute

In a letter sent to Twitter Monday morning, Elon Musk’s lawyer wrote that the company was “actively resisting and obstructing his information rights” over a dispute over spam accounts and threatened to terminate the settlement.

The letter, sent by a lawyer from Skadden, Arps, Slate, Meager & Flom, follows weeks of back-and-forth between Musk and the company over how many active users of the service are real people, as opposed to bot accounts and spam. . Musk, who refused due diligence early on in the lawsuit, later demanded additional information from the company and also wrote on Twitter that the deal was “on hold,” although work behind the scenes appears to have continued since then.

The letter states that the company sent the information to Musk on June 1 by mail, but Musk responded that he wanted to do his own analysis. “At this time, Musk believes that Twitter is transparently refusing to fulfill its obligations under the merger agreement, raising additional suspicions that the company is withholding requested data due to what Musk has done with its own analysis of that data. . “It will be revealed,” the letter reads on Monday.

Muskie’s Monday letter to Twitter leaders ends on a gaming note, effectively threatening to end the deal if the requested information is not provided.

“This is a clear violation of Twitter’s merger obligations, and Musk reserves all rights, including the right not to terminate the transaction and terminate the merger agreement,” the letter read.

Of course, it’s not immediately clear that the danger should be taken seriously if Musk is only going to negotiate a better price for the company. At Monday’s market open, Twitter stock was slightly above $40 a share, well below the $54.20 Musk agreed to pay. Further market tightening in the technical space since Musk’s offer was accepted has shown that nearly every company in the industry has lost market capital and may be looking for ways to get a discount.

That said, the terms of the deal have been reached and if Twitter doesn’t break the contract or make a serious change to Twitter’s business, it could be a tough argument. But that won’t stop Musk and his team from trying.