Elon Musk threatened to withdraw from Twitter’s $ 44 billion transaction and said the company refused to provide him with information about fake accounts.
That’s why Twitter is currently planning to give Mr. Musk access to most of that data.
The social media company has agreed to give Mr. Musk direct access to its “fire hose.” This is a stream of millions of tweets that flow daily through the company’s network, according to those with decision-making knowledge. It is unclear whether Mr. Musk has full or partial access to the “fire hose.”
This information provides Mr. Musk with a tool to identify if the number of accounts on the Twitter platform may be fake. However, the company uses another methodology that includes its own data and human analysis to get that number, which could help reach Twitter’s conclusion that 5% of active accounts are fake. Is low. Musk said he doesn’t believe that only 5 percent of Twitter’s active accounts are fake.
The move on Twitter could make it more difficult for Mr. Musk to close the deal. On Monday, his lawyer sent a letter to the company accusing him of interfering with his efforts to obtain the information essential to complete the acquisition. For weeks, Musk has tweeted increasingly harsh comments about Twitter’s fake accounts, apparently laying the groundwork for renegotiations and breaking out of the deal.
Musk agreed to buy Twitter for $ 54.20 a share in April. If the transaction collapses, there will be a $ 1 billion split fee. However, the agreement includes a “specific performance clause” that Twitter gives him the right to sue him and force him to complete or pay the transaction as long as the debt loan he encloses is intact. increase.
A Twitter spokesman declined to comment on allowing Musk access to the stream of tweets, but mentioned a previous statement.
“Twitter will work with Mr. Musk to share information and complete the transaction in accordance with the terms of the merger agreement,” Twitter said. “We believe this agreement will be in the best interests of all shareholders. We will close the transaction and enter into a merger agreement at the agreed price and terms.”
Mr. Musk did not respond to the request for comment.Washington post Previously reported Mr. Musk has access to Twitter’s fire hose.
Companies often share sensitive data with acquirers using parameters related to data sharing that were negotiated before signing the transaction. However, when Mr. Musk agreed to buy a social media company, he abandoned due diligence and Twitter began sharing sensitive information with him last month.
One of Twitter’s concerns about information sharing is a previous statement to the public and the company that Musk is considering launching a rival social media service, the New York Times reports. Such issues are usually addressed by limiting who has access to such information.
In a letter this week, Musk said the nondisclosure agreement would ensure that it would detain anyone reviewing sensitive data provided by Twitter. He also said he would not retain or share sensitive information about Twitter if the transaction collapsed.
When Musk gains access to a stream of Twitter tweets, he’s likely to need a team of experts to analyze the data and computing power to process and store vast amounts of information, he said. Business officials say.
How Elon Musk’s Twitter transaction unfolded
A blockbuster contract. Elon Musk, the wealthiest man in the world, has restricted what the famous benevolent billionaire seems to be an unlikely attempt to buy Twitter for about $ 44 billion. Here’s how the transaction was developed:
While this information provides Mr. Musk’s insights into the number of fake Twitter accounts, it also provides the data needed to plan a business once the acquisition is complete. Musk told investors he wanted to reduce his reliance on Twitter’s advertising revenue and introduce a new payments business.
For years, Twitter has calculated the number of users like many peers by reporting the number of people who are actively using the service each month. However, in 2019, the company switched to “Monetizable Daily Active Users,” a more accurate indicator of business health. This is the number of people who are active daily on your site and can be used to generate ads. Revenue.
As of April, Twitter reported that it had 229 million monetizable daily active users. Of these, Twitter estimates that 5% are fake.
On Monday, Texas Attorney General Ken Paxton said he would begin investigating fake accounts on Twitter and how they would affect state citizens. Strategists saw this move as a politically favorable way to work with Mr. Musk. Mr. Musk’s electric vehicle business, Tesla, is headquartered in Austin, Texas. Musk has also moved from California to Texas, and his SpaceX rocket company has a site in California.
