Tesla CEO Elon Musk pulled back again on his effort to purchase Twitter, accusing the social media company on Monday of withholding information about spam and fake accounts on the platform.
In a new securities filing, an attorney for Musk said that as a result, Twitter is in violation of the acquisition plan the two sides had agreed to.
"Mr. Musk has made it clear that he does not believe the company’s lax testing methodologies are adequate so he must conduct his own analysis," the attorney says. "The data he has requested is necessary to do so."
Twitter shares were down as much as 6 percent in early trading Monday.
Musk's filing follows the $44 billion offer he made to purchase Twitter in April. The company's board of directors unanimously accepted the deal on April 25, but on May 13, Musk declared the deal to be "temporarily on hold" pending additional information about the automated accounts.
Twitter currently depends on advertising for most of its revenue, so the true number of active users is essential to knowing the company's actual worth.
Twitter has routinely declared in securities filings that it believes less than 5 percent of its 229 million daily active users are bots. But Musk continues to dispute that figure, creating the ongoing impasse.
The dispute has also occurred at a time when Twitter's shares have become less valuable, leading some to speculate that Musk is simply seeking to purchase the social media company at a lower price. Since April 25, Twitter shares have lost more than a quarter of their value, and the company now has a market capitalization of less than $30 billion.
At least one law professor believes Musk may be attempting to use a theory that he was being sold a faulty product to try to renege on the deal.
In a statement, Twitter said it was still moving ahead on the transaction.
“Twitter has and will continue to cooperatively share information with Mr. Musk to consummate the transaction in accordance with the terms of the merger agreement,” it said. “We believe this agreement is in the best interest of all shareholders. We intend to close the transaction and enforce the merger agreement at the agreed price and terms.”
Monday afternoon, Texas Attorney General Ken Paxton announced an investigation of Twitter. Musk moved the headquarters of his Tesla car company to the Lone Star State last year.
