Elon Musk Launches $45B Hostile Takeover Of Twitter
Keneci Channel
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[Update] Twitter Board Adopts 'Poison Pill' Plan To Thwart Elon Musk's Takeover Bid For The Social Media Company
Following 24 hours of unhinged rhetorical opposition from left-wing activists, politicians, media talking heads and woke executives, to Musk's $45B bid, Twitter's board of directors announced a plan Friday, that will make it hard for him to buy the left-wing social media company.
The limited duration shareholder rights plan, according to the company, "will reduce the likelihood that any entity, person or group gains control of Twitter through open market accumulation without paying all shareholders an appropriate control premium or without providing the Board sufficient time to make informed judgments and take actions that are in the best interests of shareholders."
The plan, which will expire on April 14, 2023, basically means that if Musk buys more shares to gain leverage, the company will thwart it by issuing more shares at discount, to dilute his stake. He disclosed a 9.2% stake in Twitter on April 4.
Critics note that the woke board of directors chose diluting the value of shares and the company over selling to Musk. They argue that the board has failed in their fiduciary duty to shareholders given that the $54.20 per share offer he made to buy the company, is a premium.
However, most of Twitter’s top shareholders are giant woke investment companies that manage trillions of dollars of assets, such as BlackRock, Vanguard (which currently holds 10.3% stake), and State Street. These companies are run by mostly left-wing globalists who could gladly collude to help Twitter thwart Musk's bid.
The SpaceX CEO said in interview Thursday that he has a plan B in case Twitter adopts a 'poison plan.' He's reportedly speaking to investors who could partner with him on the bid.
Musk could present Twitter with an entirely new offer -- perhaps raising his current bid-- or new partners would simply go in on a purchase with him.
A new plan that includes partners could reportedly be announced within days.
Earlier this week, Musk withdrew his interest in joining Twitter’s board which would have prevented him from buying more than 15% stake in the company.
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The SpaceX and Tesla CEO made the announcement in a short Twitter post Thursday. "I made an offer," Musk wrote with a link to a Schedule 13D filing to the Securities and Exchange Commission, SEC.
Musk offered to “acquire all of the outstanding Common Stock of the Issuer not owned by the Reporting Person for all cash consideration valuing the Common Stock at $54.20 per share.”
At $54.20 per share, Musk is launching a roughly $46 billion takeover of Twitter.
The SEC filing included a voice script in which he said the $54.20-per-share offer was his best and final:
“As I indicated this weekend, I believe that the company should be private to go through the changes that need to be made. After the past several days of thinking this over, I have decided I want to acquire the company and take it private. I am going to send you an offer letter tonight, it will be public in the morning. Are you available to chat?" the SEC filing read.
The Tesla CEO sent the following formal letter to Bret Taylor, chairman of Twitter’s board:
I invested in Twitter as I believe in its potential to be the platform for free speech around the globe, and I believe free speech is a societal imperative for a functioning democracy.
However, since making my investment I now realize the company will neither thrive nor serve this societal imperative in its current form. Twitter needs to be transformed as a private company.
As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position as a shareholder.
Twitter has extraordinary potential. I will unlock it.
Twitter has reportedly scheduled an all-hands meeting with employees Thursday. Apparently many of its mostly anti-free-speech woke left-wing employees are triggered by the prospect of working for Musk.