Elon Musk said Friday that his planned $US44 billion ($61.4 billion) purchase of Twitter is “temporarily on hold” pending details about spam and fake accounts on the social media platform.
- Twitter said just five per cent of its 229 million users were fake accounts
- Elon Musk tweeted about the deal being placed on hold
- The implied probability of the deal closing at the agreed price fell below 50 per cent for the first time on Tuesday
In a tweet, the Tesla billionaire linked to a Reuters story from May 2 citing a financial filing from Twitter that estimated false or spam accounts made up fewer than five per cent of the company’s daily active users — totalling 229 million users — in the first quarter.
“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users,” Mr Musk wrote.
The move indicates Mr Musk is skeptical that the number of unauthentic accounts is that low and is the latest twist amid signs of internal turmoil over the acquisition.
It wasn’t clear whether the issue could scuttle the deal.
Twitter did not immediately respond to a request for comment.
Mr Musk’s representatives or his company, Tesla Inc, were not immediately available for a comment.
Stock in both Twitter and Tesla swung sharply in opposite directions, with Twitter’s stock tumbling 18 per cent, and Tesla, which Mr Musk had proposed using to help fund the Twitter deal, jumped 5 per cent.
Investors have had to weigh legal troubles for Mr Musk, as well as the possibility that acquiring Twitter could be a distraction from running the world’s most valuable automaker.
Mr Musk, the world’s richest man and a self-proclaimed free speech absolutist, had said that one of his priorities would be to remove “spam bots” from the platform.
Mr Musk has previously been critical of Twitter’s moderation policy.
He has said he wants Twitter’s algorithm to prioritise tweets to be public and was against too much power on the service to corporations that advertise.
Twitter said it faced several risks until the deal with Mr Musk is closed, including whether advertisers would continue to spend on Twitter amid “potential uncertainty regarding future plans and strategy.”
Earlier this week, he said he would reverse Twitter’s ban on former US President Donald Trump when he buys the social media platform, signalling his intention to cut moderation of the site.
The implied probability of the deal closing at the agreed price fell below 50 per cent for the first time on Tuesday, when Twitter shares dropped below $46.75.
Musk’s tweet comes a day after the social media company fired two of its top managers.
Twitter said the company is pausing most hiring, except for critical roles, and is “pulling back on non-labour costs to ensure we are being responsible and efficient.”
In a memo sent to employees and confirmed by Twitter, chief executive Parag Agrawal said the company has not hit growth and revenue milestones after the company began to invest “aggressively” to expand its user base and revenue.