'Still committed,' says Elon Musk, hours after putting Twitter deal on hold
NEW DELHI: After putting his $44 billion deal for acquiring social media platform Twitter on hold temporarily, Elon Musk said that he is still committed to the acquisition.
The clarification came 2 hours after Musk's tweet that the deal was “temporarily on hold” until he could get more details about the volume of spam and fake accounts on the platform.
Shortly after announcing his decision to put the deal on hold, Musk took to Twitter again and confirmed that he plans to complete the acquisition.
In his earlier tweet, Musk had made reference to a May 2 regulatory filing by Twitter that included an estimate that fewer than 5% of Twitter’s users were spam and fake accounts.
Known for his freewheeling and sometimes impulsive style, Musk’s tweet left many wondering about the future of the deal.
In a tweet earlier this month, Musk had said that if he buys Twitter he "will defeat the spam bots or die trying" and has blamed the company's reliance on advertising for why it has let spam bots proliferate.
In a regulatory filing made by Twitter, the company had said that it faced several risks until the deal with Musk is closed, such as whether advertisers would continue to spend on Twitter and "potential uncertainty regarding our future plans and strategy."
Spam or fake accounts are designed to manipulate or artificially boost activity on services like Twitter. Some are tied to improve commercial results, while others are designed to create an impression that something or someone is more popular.
The estimated number of spam accounts on the microblogging site has held steady below 5% since 2013, according to regulatory filings from Twitter, prompting some analysts to question why Musk was raising it now.
He has also been critical of Twitter's moderation policy and has said he wants Twitter's algorithm to prioritize tweets to be public and was against too much power on the service to corporations that advertise.
The world's richest person is contractually obligated to pay Twitter a $1 billion break-up fee if he does not complete the deal, and the language in the deal contract appears to cap any damages that Twitter can seek from Musk to that level.
But the contract also contains a "specific performance" clause that a judge can cite to force Musk to complete the deal.
Twitter shares are down 10% to $40.50 in morning trading on Friday, a steep discount to the $54.20 per share acquisition price.
Meanwhile, Tesla shares, against which Musk has secured $6.25 billion in funding for the acquisition, are up about 5%.
(With inputs from agencies)