It's official: Elon Musk won't be buying Twitter, after all

CBS News reported on July 8 that South African-born billionaire Elon Musk has officially withdrawn from his attempt to buy out social media platform Twitter.

Musk has accused Twitter of failing to provide the material he asked for and lying about the number of bots and spam accounts within the social media platform.

“Twitter has failed or refused to provide this information”, Musk stated in a securities filing, on the subject of fake accounts. “This information is fundamental to Twitter's business and financial performance and is necessary to consummate”.

Twitter has not taken the news well. Chairman of the board Bret Taylor announced on social media that the company was studying to pursue legal actions against Elon Musk.

Image: Jeremy Bezanger / Unsplash

CBS News highlights that, under the acquisition agreement, the founder of Tesla has to pay off one billion US dollars if the deal is terminated before completion.

South African-born tech billionaire Elon Musk called off the acquisition of Twitter in May until the social media platform provided more information about spambots and fake accounts, The New York Times reported at the time.

Musk tweeted out that the deal could not move forward until Twitter showed proof that fake accounts on the social media platform only made less than 5% of its users.

Image: elonmusk / Twitter

Some experts speculated that this could be a negotiation ploy by the founder of Tesla to lower the price of the buyout.

Image: Mariia Shalabaieva / Unsplash

The Guardian has pointed out that the board has blocked or said goodbye to some of Musk's allies within. Most notably, Twitter co-founder and former CEO Jack Dorsey, whose time as a board member ended in May.

Nonetheless, the South African billionaire seemed to have secured the necessary funding to potentially acquire the social media company, according to The Guardian.

Image: Sharon McCutcheon / Unsplash

Another complication for Musk's plans? Harassment allegations. Business Insider made public the accusations of a former SpaceX flight attendant, who is accusing the tech billionaire of misconduct.

According to Business Insider, the former SpaceX employee got paid 250,000 US dollars as a settlement. The flight attendant claims that, during a routine massage she would provide Musk, the Tesla founder requested her “to do more”.

The South African billionaire has denied the accusations, pointing out that this is the first time he has had such accusations. Musk tweeted out that the Insider story was “a hit piece to interfere with the Twitter acquisition”.

Elon Musk became Twitter’s largest stockholder on April 4, when he acquired more than 9.2% of the social media platform. However, this was not enough for one of the wealthiest men in the world.

The Tesla founder offered to buy up the entirety of Twitter for 43 billion US dollars, despite an earlier promise that he would not try to acquire more than 14.9% of the company’s stock.

According to The New York Times, 40 billion US dollars is 40% above the value of the stock price of the social media platform at the time of the offer.

The tech billionaire also rejected becoming part of Twitter’s board of directors, which surprised many experts. Seems that Musk was going all or nothing with his new investment.

Image: Souvik Banerjee / Unsplash

The New York Times also reports that after becoming Twitter’s biggest stockholder, Musk published a letter arguing that the company’s current management lacks the vision to fulfill the company’s “societal imperative” as a platform of free speech and “unlock Twitter’s full potential”.

Al Jazeera remarks that the tech billionaire has expressed his desire to turn Twitter into a private company, free from the pressure of its investors and the stock market.

Twitter CEO Parag Agrawal has praised Musk. “Both a passionate believer and intense critic of the service, which is exactly what we need”, posted Agrawal on his official account on the platform.

During an interview for Ted Talk on April 15, days after Musk made his offer, the Tesla founder claimed he would get rid of “the scam and spambots, the bot armies that are on Twitter”.

This is hardly the only initiative Elon Musk has revealed he would like to apply to the platform. The most notable of these is probably adding an edit button for tweets, something that so far Twitter has not allowed, unlike Facebook or Instagram.

The tech billionaire has also highlighted that he would like to make Twitter’s algorithm more transparent, something that Twitter’s co-founder and former CEO Jack Dorsey (pictured) seemed to support. Musk and Dorsey are on friendly terms.

However, on April 15, Twitter’s board of directors rebuffed Musk’s 40-billion-dollar offer with their own contingency plan, dubbed a ‘poison pill’.

In the financial world, poison pills can vary, but Al Jazeera explains the basic idea: If any entity tries to buy 15% or more of Twitter’s stocks, the board of directors would flood the market with newly created stocks making the acquisition difficult.

The strategy was created in the 1980s on Wall Street to avoid hostile takeovers from corporate raiders. However, it has also been used in the past as a negotiation ploy.

Among those opposing Elon Musk taking possession of Twitter? Prince Alwaleed bin Talal of Saudi Arabia, who according to Al Jazeera owns over 5% of the social media platform.

Alwaleed bin Talal criticized Musk’s offer on his official Twitter account. Besides the social media platform, the prince’s Kingdom Holding Company also has investments in Uber, Lyft, Citibank, and Four Seasons Hotels.

‘What are the Kingdom’s views on journalistic freedom of speech?’, Musk mused on Twitter. Later, he shared a New York Times article about two former Twitter employees accused of sharing information on Saudi dissidents with the government of the Middle-Eastern kingdom.

Pictured: King Salman of Saudi Arabia.

Twitter and Elon Musk have a long history. However, not so much related to business, but as a platform for Musk to share his views with the world.

As CNN points out in an April 5 website article, Musk has over 80 million Twitter followers, far more than most CEOs.

Musk, according to CNN, has become infamous for his Twitter use. He has used the platform to take shots at politicians, news outlets, and media personalities, engage in arguments with people he disagrees with, and make crude remarks and random musings that have affected the value of his enterprises.

In an infamous example from 2018, he made unfounded allegations against a diver rescuing a youth soccer team from a flooded cave in Thailand.

In the past, Musk has criticized how the platform has limited free speech and even compared the current CEO to Soviet leader Joseph Stalin.

Musk has not reached the level of being banned from Twitter, as happened to former US President Donald Trump. However, it's probable that the relationship between the tech billionaire and the social media platform won't be on the best terms from now on.