Musk says $44-bn Twitter deal on hold, seeks details on spam accounts

The company has estimated that false or spam accounts represented fewer than 5% of its monetizable daily active users

Elon Musk said on Friday his $44-billion deal for Twitter Inc was temporarily on hold, citing pending details on spam and fake accounts.

"Twitter deal temporarily on hold pending details supporting calculation that spam/fake accounts do indeed represent less than 5% of users," Musk said in a tweet.
 

Shares of the social media company fell 20% in premarket trading. Twitter did not immediately respond to a request for comment.

The company had earlier this month estimated that false or spam accounts represented fewer than 5% of its monetizable daily active users during the first quarter.

It also said it faced several risks until the deal with Musk is closed, including whether advertisers would continue to spend on Twitter.

Musk, the world's richest man and the chief executive of Tesla Inc, had said that one of his priorities would be to remove "spam bots" from the platform.

Musk has also said he’d like to make the platform a bastion of free speech, taking the guardrails off of content moderation. Bots are currently allowed on Twitter, though under the company’s policy, such accounts are supposed to indicate that they’re automated. The platform has even launched a label for “good” bots, such as @tinycarebot, an account that tweets self-care reminders. Spam bots, however, are not permitted, and the company has policies meant to combat them. 

Doubts have grown in recent days that Musk would be able to pull off his acquisition of Twitter. The spread on the deal, which offers an indication of how much Wall Street believes the takeover will be completed, swelled further on Thursday to $9.11 from $8.11 in the previous session. That was the widest level since the billionaire launched his bid last month to purchase the Twitter for $54.20 -- and double where it was last week when he announced a roughly $7.1 billion financing commitment.

Musk has also been in talks with investors to raise enough equity and preferred financing for his proposed buyout of Twitter to eliminate the need for any margin loan linked to his Tesla shares, according to people with knowledge of the matter. 

He recently disclosed $7.1 billion in equity commitments from investors including Larry Ellison, Sequoia Capital, Qatar Holding and Saudi Prince Alwaleed bin Talal, with the latter rolling his Twitter stock into the deal.

(With inputs from Reuters and Bloomberg.)