(Quartz) - Elon Musk has buyer’s remorse. On April 25, the billionaire Tesla and SpaceX CEO agreed to buy Twitter for $44 billion, but since then the stock market has tanked. Twitter agreed to sell to Musk at $54.20 per share, a 38% premium at the time; today it’s trading around $40.
That’s probably the real reason Musk is spending so much time talking about bots. On May 13, he claimed the Twitter deal was “on hold” because of a discrepancy over how much of the platform’s user base is made up of bots—a catch-all term for automated accounts. On June 6, Musk’s lawyers sent a letter to Twitter and the US Securities and Exchange Commission, asserting his right to terminate the contract if the company doesn’t share information that would let Musk conduct his own analysis of the Bot Situation, analysis that Musk says is necessary to secure loans for the deal.
It’s a tricky claim: Musk would need to show that his loan agreements really are contingent on getting this information about bots. To make sense of the legal nuance, Quartz spoke to Ann Lipton, associate dean for faculty research at Tulane Law School, who is a corporate and securities law expert and has followed the Musk-Twitter saga closely.
By Scott Nover
