The agreement between Elon Musk and the social media giant Twitter is cancelled.
In a letter to Twitter's legal department (opens in a new tab) on Friday night, Musk called for a termination of the merger agreement between him and his backers, with Twitter stating, "because Twitter is in material breach of several provisions of this agreement." , appears to have made false and misleading statements relied upon by Mr. Musk in entering into the merger agreement, and is likely to have a material adverse effect on the company (as that term is defined in the Merger Agreement)” .
The letter was also filed with the SEC (opens in a new tab).
The reversal of interest comes three months after Musk tried to buy the popular social media platform for $44.000 billion (opens in a new tab).
The problem is the number of spam or bot accounts on Twitter. Musk believes the platform is overcrowded, and Twitter insisted his estimate was wrong. They eventually offered to let him see his data, but Musk wanted an independent audit.
The letter adds that “Twitter has failed or refused to provide this information. Twitter has sometimes ignored Mr. Musk's requests, sometimes rejected them for reasons that seem unjustified, and sometimes claimed to comply while giving Mr. Musk incomplete information." or useless information.
Musk had big plans for Twitter, including turning it into a public square, pushing the editable tweets feature (which Twitter is already working on), and being more open to unrestricted speech from all sides. He feared he might invite former President Donald Trump back on Twitter (he was banned after the Jan. 6 attacks), but this has never been confirmed.
While Musk previously put the deal on hold while trying to get more information about the number of bots on the platform, he had been fairly quiet about it in recent weeks, notably not tweeting in an attempt to terminate the deal.
Whether or not the deal is truly dead remains to be seen. Musk could be on the hook for millions and Twitter or the shareholders, who reportedly approved the deal next month, could sue Musk.
Still, it seems unlikely that Musk will consider a new deal.