Musk met with the company's top brass for three days to discuss its business before he publicly announced his bid, but he said he wouldn't move forward with the acquisition until he had more information about fake accounts on the platform.
The filing doesn't say what was discussed in those meetings or if Musk brought up his concerns about the bots.
In late March and early April, Musk held discussions with several company executives, including former CEO Jack Dorsey, current CEO Parag Agrawal, and board member Egon Durban.
The meetings took place after Musk made a formal bid for the company. The future of the deal is uncertain as Musk has said the acquisition will not move ahead until he has a clearer sense of the number of fake accounts on the platform.
There are concerns that Musk will abandon his agreement to purchase Twitter for the agreed upon price of $54.20 a share. Since Musk disclosed his 9% stake in the company last month, the stock has given up all of its gains. On Tuesday, the last trading day before Musk revealed his ownership in the micro-messaging service, shares of the company were up 3% to $38.54.
On Tuesday, Musk doubled down on his conviction that the deal cannot move forward until the company can prove that less than 5% of users on the platform are bots. There are automated accounts that can be useful. Neither Musk nor the social media company has said how they define a fake account.
The offer was based on the SEC filings. The number also applies to its monetizable daily active users. The actual number of false or fake accounts could be higher than the company has estimated. The company relies on private user information and can't publicly reveal specific details of the process. Musk replied to one of Agrawal's posts with a smile and a question: "So how do advertisers know what they're getting for their money?" This is fundamental to the financial health of the company. Does anyone have that experience? Musk hasn't provided any evidence that the calculations are unreliable. Chris Kelly, Facebook's former chief privacy officer and general counsel, told CNBC in an interview on Tuesday that the estimates of the bot on the micro-blogging site are pretty good. Unless he comes up with real evidence, his assertions are just assertions. A class-action lawsuit was brought in 2016 by shareholders who argued that the company artificially inflated its stock price by misleading them about user engagement. Musk has ideas on how to measure the number of fake accounts on the micro-blogging site. Last week, Musk said he would review a random sample of 100 followers of his account. Musk's approach won't work and should not serve as due diligence, experts told CNBC. The former Facebook chief privacy officer says that Musk doesn't seem to have evidence for his claims.
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