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Facts Elon Musk Canceled Buying Twitter Rp650 Trillion

Navigasi - Elon Musk has pulled out of the Twitter purchase deal. Several things became the culprit behind the decision of the world's richest man to cancel buying Twitter. One of them is the number of 'bots' on Twitter.

Facts Elon Musk Canceled Buying Twitter Rp650 Trillion
Facts Elon Musk Canceled Buying Twitter Rp650 Trillion

Whereas previously Elon Musk said he would address and fix the bot problem on Twitter. Musk initially said he would fix the bot problem.

However, the same problem he is saying now is the main reason for canceling the (Twitter purchase) deal," said a source quoted by CNN, Monday (11/7/2022).

After announcing he wanted to quit his deal to buy Twitter, Elon Musk spent the weekend in Idaho at the Sun Valley Conference. There he spoke on stage.

Shares of the world's largest electric vehicle maker Tesla Inc may take some action after its CEO Elon Musk said he plans to scrap his deal to buy Twitter Inc for $44 billion or $54.20/share.

Facts Elon Musk Canceled Buying Twitter Rp650 Trillion

Musk thinks Twitter has failed to provide information about fake accounts. In a letter filing through a lawyer, Musk took issue with Twitter for not responding to multiple requests for information about fake or spam accounts on the platform. Here are the facts about Musk's planned acquisition of Twitter.

1. Elon Musk has threatened to resign

Musk, from the outset, threatened to back out of the deal after complaining that Twitter was dishonest about the number of fake accounts on the site. Twitter said that Musk had received the correct information from the company and plans to hold it on to the agreement.

"Twitter is in material breach of some of the terms of the agreement, appears to have made the false and misleading statements that Musk relied on when entering the Merger Agreement," the filing reads.

2. Elon Musk asks for fake Twitter accounts to be less than 5 percent

The richest person in the world has previously asked for guarantees from Twitter to ensure that the number of social media user accounts that are fake accounts or spam alias bots is less than 5 percent. The filing states that Musk and his financial advisors at Morgan Stanley have been requesting critical information from Twitter since May 9, 2022 regarding the matter. Elon Musk even postponed the purchase until the social media company proved that bot accounts were less than the percentage he expected compared to its total users.

3. Twitter is going to court

On Friday afternoon, July 8, 2022, Twitter chairman Bret Taylor said the company's intention was to go to court after Musk canceled his acquisition. "Twitter's board is committed to closing the transaction at the price and terms agreed with Mr. Musk and plans to take legal action to enforce the merger agreement. We believe we will prevail in Delaware District Court," he said.

4. Fines to be paid

The terms of the deal require Musk to pay a $1 billion termination fee if he doesn't complete the transaction. Musk has threatened to terminate the deal unless the company shows evidence that spam and bots account for less than 5 percent of users who view ads on the social media service.

The acquisition was originally announced by Musk on April 14. The Tesla owner said he would pay $54.20 in cash for each Twitter share, a 38 percent premium to the stock's closing price the previous day.

5. Financing scheme

In accordance with his plan to shrink the majority of Twitter shares, Elon Musk has increased his financing commitments in social media companies to US $ 33.5 billion (Rp 489 trillion) from US $ 27.25 billion (Rp 398 trillion). This includes the US$7.14 billion (Rp 104 trillion) funding announced earlier in May.

In addition, he received a Morgan Stanley margin loan relating to his Tesla stock. It is valued at US$ 6.25 billion (Rp 91.2 trillion) and has been removed from the financing equation. Elon has secured a commitment from the bank amounting to US$ 13 billion (Rp 189.8 trillion) in the form of a loan secured by Twitter shares.

6. Paid Twitter plans

Before the acquisition was canceled, Musk said it was possible to impose tariffs on some Twitter users. The founder of Tesla and SpaceX revealed that the paid tariffs will be aimed at users for commercial and government purposes.

The plan was submitted by Elon Musk to boost the social media platform's source of income. “Twitter will remain free for casual users. However there may be a small additional fee for commercial and government accounts," he tweeted on the official @elonmusk personal account.

As written on Channel News Asia, Musk is reported to have submitted a plan to monetize user tweets to the banking sector. In addition, he plans to review the salaries of Twitter executives to reduce the cost burden of the platform. There are also plans to develop features that will enable business revenue growth, including proposals to generate revenue from tweets containing important or viral information.