ARCHIVE – The Twitter icon appears on a mobile phone in Philadelphia on April 26, 2017. Twitter said in a statement on Friday, April 15, 2022, that its board unanimously adopted a “poison pill” in response to Tesla CEO Elon’s proposal Musk to buy the company and get it private. (AP Photo / Matt Rourke, Archive) Twitter’s board says it has adopted a “poison pill” to protect its social media platform from “forced or otherwise unfair” acquisition tactics. The company announced the move on Friday and provided more details on a regulatory deposit early Monday. On Thursday, Tesla CEO Elon Musk unveiled a $ 43 billion offer of the company, or $ 54.20 per share. It currently owns about 9% of Twitter shares. A rights agreement reached by the board of directors would give shareholders from April 25 the right to buy one millimeter of a preferred stock for each common stock they hold, at a price of $ 210, if any individual or group of investors acquires 15%. or more of the company’s shares without board approval, Twitter said in a statement Monday to the U.S. Securities and Exchange Commission. The preferred share will have the same voting rights as a common share. It would give existing shareholders more votes, making it more difficult for an investor to take control of the company. The deposition does not specifically mention Musk. “The result of the agreement may be ‘make it more difficult or discourage a merger, tender or exchange offer or other business combination involving the company,’” the statement said. Despite the defense with the poison pill, the board still leaves open the possibility of negotiating with Musk or another suitor. The filing states that the rights agreement must not interfere with any merger, offer or other business combination approved by the board of directors. Twitter’s board has not officially rejected Musk’s offer. Wedbush Securities analyst Daniel Ives said it was interesting that Twitter first filed the shareholder bill before rejecting Musk, but expects the rejection to take place in the next 24 to 48 hours. “Making Twitter private at $ 54.20 should be up to shareholders, not the board,” Musk wrote on Twitter on Thursday. He added: “If the current Twitter board takes action against the interests of shareholders, they will be violating their duty of fidelity. “The responsibility they would take would be titanic.” Twitter said in a statement Thursday that Musk had offered to buy the company for more than $ 43 billion. Musk said Twitter “needs to be transformed into a private company” in order to build trust with its users and better serve what it calls a “social imperative” of free speech. Musk called the offer final, though he did not provide details on funding. Such details could improve his chances of buying the company. Musk could probably raise some of that money by lending billions using his shares in Tesla and SpaceX as collateral. Shares of Twitter rose almost 3% to $ 46.38 in Monday morning trading, another $ 7.82 compared to Musk’s bid. This is a sign that investors are skeptical about whether Musk can complete the deal. Musk has revealed in regulatory deposits in recent weeks that he has been buying shares of Twitter in near-daily batches since Jan. 31, ending with a share of about 9%. Only Vanguard Group controls more Twitter notifications. A lawsuit filed in federal court in New York on Tuesday alleges that Musk was late in revealing his stake in the social networking company so he could buy more shares at lower prices. On Twitter on Monday, Musk wrote that board members would not be paid if his offer was successful. That would save Twitter about $ 3 million a year, he wrote.
