Musk's Twitter acquisition on shaky ground, report

Billionaire has rejected Twitter's evidence that bots and fake accounts are a small problem, may be seeking an exit

Elon Musk's $44 billion acquisition of Twitter is looking increasingly doubtful after he has reportedly rejected evidence meant show that bots and fake accounts are not a major problem.

In May, Elon Musk has said that his planned $44 billion purchase of Twitter was 'temporarily on hold' pending an investigation into the number of bots and spam accounts on the social media platform.

Removal of fake accounts is a key plank in Musk's stated plans to revitalise Twitter. However, over the last couple of years the platform has been making concerted efforts to take down such accounts and claims that they now make up less than the 5% of the total. Musk refused to accept this figure and asked for more data. The platform obliged, providing 500 million tweets to the mogul a short time later.

Musk's team has rejected this data, saying it cannot be verified, according to a report in the Washington Post, which cites three people familiar with the matter,

Musk is suspected by analysts to be using the issue to try to back out of the deal, not least because Twitter's $37.10 share price is currently 31% below his bid's $54.20.

The deal has a $1 billion penalty clause that would apply should Musk renege on the deal, which would likely see Twitter shares drop still further. Carl Tobias, Williams chair in law at the University of Richmond, told the Guardian that Musk may be using the argument over spam accounts to avoid having to pay the penalty.

"The dustup over bots seemed to be pretextual to avoid having to forfeit the $1 billion breakup fee. Thus, for weeks, Musk seemed to be saying that he was not comfortable with the deal and he now appears to be attempting to back out of the deal."

Twitter has made cuts and hiring freezes in order to conclude the deal. According to the Wall Street Journal on Thursday, the company recently laid off 30% of its talent acquisition team.

The financial downturn has caused other tech companies to implement hiring freezes too, including Uber and Meta.