Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Twitter adopts 'poison pill' measure that could thwart Elon Musk's takeover bid

Twitter adopts 'poison pill' measure that could thwart Elon Musk's takeover bid

Twitter's board of directors has adopted a limited-term shareholder rights plan called a "poison pill" that could make it harder for Elon Musk to acquire the company.

The "poison pill" provision, announced in a press release Friday, preserves the right for Twitter shareholders other than Musk to acquire more shares of the company at a relatively inexpensive price, effectively diluting Musk's stake. The provision will be triggered if Musk (or any other investor) acquires more than 15% of the company's shares. Musk currently owns around 9% of Twitter's shares.

The move marks an effort by Twitter's board to wrest back some control in the deal after Musk's stunning acquisition offer. The poison pill — a corporate anti-takeover defense mechanism — won't necessarily stop Musk's bid in its tracks, but it could make buying the company more expensive or force Musk to the negotiating table with the board.

"The Rights Plan 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 company said in its statement.

Musk's first public statement after Twitter's announcement came Friday afternoon, through a quote tweet of a Twitter poll by the account @BTC_Archive asking: "Do you want Elon Musk to buy Twitter?"

"Thanks for the support!" the billionaire wrote while sharing the poll, which at the time of writing had a majority of respondents voting "Yes." Musk did not respond to a request for comment from CNN Business.

The Tesla and SpaceX CEO on Thursday offered to acquire all the shares in Twitter he does not own for $54.20 per share, valuing the company at $41.4 billion. That represents a 38% premium over the closing price on April 1, the last trading day before Musk disclosed that he had become Twitter's biggest shareholder, and an 18% premium over its closing price Wednesday. The deal offer came 10 days after Musk first disclosed that he had become Twitter's largest shareholder (he has since been eclipsed by Vanguard Group).

The offer capped off a whirlwind 10-day period during which Musk revealed he had become the company's largest shareholder, accepted a position on the board only to ditch it, and tweeted throughout about how Twitter may be dying and should consider eliminating the "w" from its name, among other suggestions.

The company now appears to be prepping for what could be a drawn-out acquisition drama.

Wedbush analyst Dan Ives called the poison pill a "predictable defensive measure" by Twitter's board and added, "we believe Musk and his team expected this poker move." Ives also noted there is a risk that Twitter's plan could get challenged by Musk or other shareholders in court, which could put the board in the position of defending that the plan was in the best interest of shareholders.

Even so, there seem to be sincere doubts about whether Musk, a successful but sometimes erratic entrepreneur who ended up in hot water with regulators in 2018 after falsely suggesting that he had secured funding to take Tesla private, is serious about moving forward with the deal.

Despite being the richest man in the world, there are questions about how he would come up with the cash to finance the nearly $42 billion deal. Musk himself admitted in an interview Thursday that closing a deal would be challenging, saying, "I'm not sure I'll actually be able to acquire it."

Twitter's stock fluctuated a bit Thursday but remained mostly flat, closing around $45, well below Musk's offer price of $54.20 per share. The lack of enthusiasm — unusual after a takeover offer — suggests investor skepticism about the deal going through.

Twitter's poison pill plan will stay in effect for one year, the board said. More details about the plan are expected to come in a filing with the Securities and Exchange Commission, which is not yet publicly available.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Severe Heatwave Claims 2,300 Lives Across Europe
Declining Beer Consumption Signals Cultural Shift in Germany
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
China Unveils Miniature Insect-Like Surveillance Drone
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Massive Anti-Government Protests Erupt in Belgrade
Iran Executes Alleged Israeli Spies and Arrests Hundreds Amid Post-War Crackdown
Hungary's Prime Minister Criticizes NATO's Role in Ukraine
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Hungarian Scientist to Conduct 30 Research Experiments on the International Space Station
NATO Members Agree to 5% Defense Spending Target by 2035
NATO Leaders Endorse Plan for Increased Defence Spending
U.S. Crude Oil Prices Drop Below $65 Amid Market Volatility
International Astronaut Team Launched to Space Station
Macron and Merz: Europe must arm itself in an unstable world
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Iran Intensifies Crackdown on Alleged Mossad Operatives After Sabotage Claims
Trump Praises Iran’s ‘Very Weak’ Response After U.S. Strikes and Presses Israel to Pursue Peace
Oil Prices Set to Surge After US Strikes Iran
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
×