Musk says Twitter purchase will not go ahead without clarity on spam accounts

Billionaire Elon Musk said Tuesday that his purchase of Twitter would not go ahead unless he was given assurances on the bots that he says plague the platform, further complicating his acrimonious bid for the social media giant.

The chief of SpaceX as well as Tesla, Musk is currently listed by Forbes as the world's wealthiest person, with a fortune of about $230 billion, much of it in Tesla stock.

Seen by his champions as an iconoclastic genius and by his critics as an erratic megalomaniac, Musk surprised many investors in April with news that he wanted to purchase Twitter.

But his $44 billion bid for Twitter is now "temporarily on hold," pending questions over the social media company's estimates of the number of fake accounts, or "bots."

"Yesterday, Twitter's CEO publicly refused to show proof of <5 per cent," tweeted Musk, who has almost 94 million followers on the social network.

"This deal cannot move forward until he does."

Twitter chief executive Parag Agrawal has said the platform suspends more than a half-million seemingly bogus accounts daily, usually before they are even seen, and locks millions more weekly that fail checks to make sure they are controlled by humans and not by software.

Internal measures show that fewer than five percent of accounts active on any given day at Twitter are spam, but that analysis can't be replicated externally due to the need to keep user data private, Agrawal contended.

Musk, who has said bots plague Twitter and that he would make getting rid of them a priority if he owned the platform, responded to that tweet by Agrawal with a poo emoji.

"So how do advertisers know what they're getting for their money?" Musk tweeted in a subsequent response about the need to prove Twitter users are real people.

"This is fundamental to the financial health of Twitter."

The process used to estimate how many accounts are bots has been shared with Musk, Agrawal insisted.

"It appears the spam/bot issue is cascading and clearly making the Twitter deal a confusing one," Wedbush analyst Dan Ives said in a note to investors.

"The bot issue at the end of the day was known by the New York City cab driver and feels more to us like the 'dog ate the homework' excuse to bail on the Twitter deal or talk down a lower price."

Musk has described his motivation as stemming from a desire to ensure freedom of speech on the platform and to boost monetization of a website that is massively influential but has struggled to attain profitable growth.

He has also said he favored lifting the ban on Donald Trump, who was kicked off the platform in January 2021 shortly after the former US president's efforts to overturn his election defeat led to the January 6 assault on the US Capitol.

Meanwhile, Elon Musk on Friday put his $44-billion deal for Twitter Inc temporarily on hold, citing pending details in support of calculation that spam and fake accounts indeed represent less than 5 per cent of users.

“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than five per cent of users,” Musk said in a tweet.

Shares of the social media company fell 17.7 per cent to $37.10 in premarket trading, their lowest level since Musk disclosed his stake in the company in early April and subsequently made a “best and final” offer to take it private for $54.20 per share.

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.

Twitter had earlier this month estimated that false or spam accounts represented fewer than 5 per cent of its monetisable daily active users during the first quarter, when it recorded 229 million users who were served advertising.

“Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5 per cent of users,” Musk tweeted on Friday.

However, hours later, he said he was still committed to buying Twitter. "Still committed to acquisition," wrote Musk, after his earlier message had seen the firm's share value plunge.

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.

Twitter did not immediately respond to a request for comment. Musk's representatives or his company Tesla Inc were not immediately available for a comment.

The social media company had said it faced several risks until the deal with Musk is closed, including whether advertisers would continue to spend on Twitter amid “potential uncertainty regarding future plans and strategy.”

Musk has 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.