Elon Musk tells Twitter he's terminating deal to buy social media giant

Elon Musk said that Twitter made 'misleading representations' when the agreement was signed

Elon Musk has informed Twitter that he's terminating a deal to buy the social media giant.

A law firm representing the Tesla CEO sent a letter to Twitter on Friday, alleging that it appears "to have made false and misleading representations" when Musk agreed to buy the company on April 25 and has "breached" multiple provisions of the initial agreement.

The announcement from Musk comes after a monthslong feud over how many spam and fake accounts are on Twitter, and the Tesla CEO requested that Twitter provide details supporting its internal estimate that less than 5% of the platform's accounts are spam or fake.

Twitter CEO Parag Agrawal said an external review to determine the percentage of spam or fake accounts would be difficult to perform because of the "critical need to use both public and private information." The company eventually agreed to hand over a "firehose" of data from over 500 million tweets that are posted every day.


Elon Musk at the Metropolitan Museum of Art

Elon Musk attends The Metropolitan Museum of Art's Costume Institute benefit gala celebrating the opening of the "In America: An Anthology of Fashion" exhibition on May 2, 2022, in New York. (Photo by Evan Agostini/Invision/AP / AP Newsroom)

However, in the letter sent to Twitter on Friday, Musk's lawyer alleges that Twitter has given "incomplete or unusable information," adding that information regarding spam and fake accounts was critical to close the deal.

"For nearly two months, Mr. Musk has sought the data and information necessary to ‘make an independent assessment of the prevalence of fake or spam accounts on Twitter’s platform,'" his lawyer wrote. "This information is fundamental to Twitter’s business and financial performance and is necessary to consummate the transactions contemplated by the Merger Agreement because it is needed to ensure Twitter’s satisfaction of the conditions to closing, to facilitate Mr. Musk’s financing and financial planning for the transaction, and to engage in transition planning for the business."

"Twitter has failed or refused to provide this information. Sometimes Twitter has ignored Mr. Musk’s requests, sometimes it has rejected them for reasons that appear to be unjustified, and sometimes it has claimed to comply while giving Mr. Musk incomplete or unusable information," Musk's lawyer added.

Despite multiple requests for more information regarding "the prevalence of false or spam accounts on the platform," Twitter has not provided the information that Musk has requested, the lawyer alleges.


Twitter San Francisco

A sign is pictured outside the Twitter headquarters in San Francisco, Monday, April 25, 2022. (AP Photo/Jed Jacobsohn / AP Newsroom)

"While Twitter has provided some information, that information has come with strings attached, use limitations or other artificial formatting features, which has rendered some of the information minimally useful to Mr. Musk and his advisors," the letter states.

Musk's lawyer also alleges that "all indications suggest that several of Twitter’s public disclosures regarding its [monetizable daily active users] are either false or materially misleading."

Twitter board of directors Chairman Bret Taylor responded to the letter on Friday evening, stating that it plans to pursue legal action to enforce the merger agreement between Musk.

"The Twitter Board is committed to closing the transaction on the price and terms agreed upon with Mr. Musk and plans to pursue legal action to enforce the merger agreement. We are confident we will prevail in the Delaware Court of Chancery," Taylor said.

After-hour shares of Twitter fell by 6% following the announcement by Musk's lawyer.


Elon Musk

Tesla and SpaceX CEO Elon Musk arrives on the red carpet for the Axel Springer media award in Berlin.  (Hannibal Hanschke/Pool Photo via AP, File / AP Newsroom)

Twitter pointed FOX Business to Taylor's statement when reached for comment.