Posted in: 16/04/2022 – 18:40
Twitter seeks to prevent Tesla Chairman Elon Musk from acquiring it, and since Friday has taken measures to counter this trend and prevent the world’s richest man from easily buying all of its shares. To achieve this goal, the company will make its shares available for sale in front of all other shareholders, announcing a plan that allows them to buy additional shares in a procedure called in the financial sector as a “poison pill”, and it will be implemented if Musk’s contribution to Twitter exceeds 15 percent without obtaining approval from the board of directors. Administration.
Twitter plans to avoid the trap of the Tesla boss Elon Musk The one who announced his intention to acquire it, as it embarked on Friday to take measures aimed at countering this trend and preventing the world’s richest man from easily buying all of its shares.
The company seeks to make its shares available for sale to all other shareholders, and has announced a plan to allow shareholders to buy additional shares, a procedure called in the financial sector as a “poison pill”. This procedure will start if Musk’s contribution to Twitter exceeds 15 percent, without obtaining approval from the board of directors. Early this month, Musk acquired a 9.2 percent stake in the company’s capital.
risky plan
And if the billionaire buys enough shares to reach 15 percent, all other stock holders will have the opportunity to buy them at a discount, which will significantly increase the price that the businessman must pay to acquire the platform.
In the context, 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 take action.” conscious decisions. Twitter therefore intends to fight any attempt by Elon Musk to acquire it and remove it from the exchange.
Dan Ives of Woodbush noted that “this defensive plan was expected”, but he expected that shareholders would not view it “comfortably”, as it carried the risk of “downgrading” (ie, lower shareholding due to the issuance of new stock). He added that “the plan will certainly face an appeal in court,” because the board of directors is obligated to work for the company and increase its value for the benefit of shareholders.
“a platform for freedom of expression”
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. On Thursday, Musk said in an interview at the TED2022 conference that he had the “necessary funds” to buy Twitter, stressing that he had an alternative plan in case the company’s board of directors rejected his offer. He indicated that he was not seeking to “make money”. Musk did not provide details regarding the financing of his offer, but he will inevitably have to borrow money from one of his companies, “Tesla” or “SpaceX”, or give up part of his shares in them.
Elon Musk is very active on Twitter, as he publishes tweets almost daily to his 81.3 million followers, but he also criticizes the platform regarding its policy related to the supervision of content, and confirms that he wants to make Twitter “a platform for freedom of expression in the world” and in imposing Less restrictions on users’ tweets.
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 announcing his acquisition of a stake in the network, Musk has not stopped provoking. He wondered, for example, whether the social network was on the verge of “dying” because there were many accounts with millions of followers but were inactive.
Do you want Elon Musk to buy Twitter?
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.”
Commenting on the survey, Musk asked 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 matter for the shareholders, not the board of directors.” This view was supported by more than 83 percent of the 2.9 million users who participated in the poll. “I think that will be very painful and I’m not sure about buying it,” Musk said Thursday, before expressing his hope to win the support of as many current shareholders as possible for his project.
Twitter contributor, Saudi Prince Al-Waleed bin Talal, commented, saying that Musk’s offer did not fit the “actual value of Twitter.” Analysts from Wedbush Securities, who expected the billionaire’s victory after many vicissitudes, also considered that the influence and pressure exerted by Elon Musk does not leave a large area of freedom for Twitter managers.
Dan Ives said in an analytical article published in the newspaper “Daily Mail” Thursday that “the board of directors does not want Musk because its members disagree with him on almost all issues, and his style does not fit with the culture of the company.” “The board of directors will look for a person or group that offers a better offer. But it will be difficult for other investors to emerge,” he said.
FRANCE 24/AFP