Twitter seeks to avoid falling into the trap of Elon Musk, the head of “Tesla”, who announced his intention to acquire it, On Friday, it began taking measures aimed at countering this trend and preventing the world’s richest man from easily buying all of its shares.
According to “French”, The company plans to make its shares available for sale to all other shareholders, It announced a plan to allow shareholders to buy additional shares, It is a measure called the “poison pill” in the financial sector.
This procedure will be implemented if Musk’s contribution to Twitter exceeds 15 percent. without obtaining approval from the Board of Directors. Earlier this month, Musk acquired a 9.2 percent stake. of the company’s capital.
And if the billionaire buys enough shares to reach 15 percent, All other stock holders will be able to buy them at a discount, This will significantly raise the price the entrepreneur must pay to acquire the platform.
The company said in a statement, “The plan would reduce the possibility of any entity, person or group taking control of Twitter by accumulating shares purchased in the market without paying an appropriate control premium to all shareholders.” And without leaving enough time for the board of directors to make informed decisions.”
Twitter therefore intends to fight any attempt by Elon Musk to acquire it and remove it from the stock exchange.
“This defensive plan was to be expected,” Dan Ives of Woodbush noted. But he expected shareholders not to view it “comfortably”, It carries a risk of “downgrading”, Any decrease in the percentage of ownership of a share of shares due to the issuance of new shares.
He added, “The plan will certainly face an appeal in the judiciary. Because the board of directors is obligated to work in the interest of the company and increase its value for the benefit of the shareholders.
On Wednesday, Musk had offered to buy the entire company at a price of 43.3 billion dollars, while the company’s price was estimated at 36 billion dollars on that day.
“He has the money to buy Twitter,” he said Thursday in an interview at the TED2022 conference. He stressed that he has an alternative plan in case the company’s board of directors rejects his offer and that he does not seek to earn money.
Musk did not provide details about the financing of his offer. But he will inevitably have to borrow money from one of his companies, “Tesla” or “SpaceX”, Or he will give up part of his shares in them.
Elon Musk is very active on Twitter. He tweets almost daily to his 81.3 million followers. But he is also critical of the platform over its content moderation policy, He asserts that he wants to make Twitter a platform for freedom of expression in the world. and in imposing fewer restrictions on users’ tweets.
And after the billionaire acquired about 73.5 million shares of Twitter’s common stock last week, He was offered to join the company’s board of directors, but he chose not to do so.
Since the announcement of his acquisition of a stake in the network, Musk never stopped provoking. He wondered, for example, if the social network was on the verge of “death”, Because there are many accounts with millions of followers, but they are not active?
On Friday, Musk tweeted, “Thank you for the support!”, accompanying his tweet with a poll conducted by “Bitcoin Archive” entitled “Do you want Elon Musk to buy Twitter?” And 73 percent of the voters, who numbered 19,944 participants, answered “yes.”
In response to the survey, Musk polled his followers about their support for the idea that “making Twitter a private company by buying it at $54.20 per share should be a shareholders’ business, not a board matter.” This view was supported by more than 83 percent of the 2.9 million users who participated in the poll.
“I think it’s going to be very painful,” Musk said Thursday. I’m not sure I’d buy it” before expressing his hope that he would win the support of as many current shareholders as possible for his project.
Analysts from Wedbush Securities said they expected the billionaire’s victory after many ups and downs, The influence and pressure exerted by Elon Musk does not leave a large area of freedom for the administrators of “Twitter.”
“The board does not want Musk,” Dan Ives said in an analytical article published in the “Daily Mail” Thursday. because its members disagree with him on almost all matters, In addition, his style does not fit the culture of the company.”
“The board of directors will look for a person or group that makes a better offer,” he added. But it will be difficult for other investors to emerge.”
