Twitter, which is the subject of an unsolicited takeover bid by Elon Musk, announced on Friday that it was taking steps to defend itself from this offensive, measures supposed to prevent the boss of Tesla and the richest man of the world to easily redeem its shares.
This is the so-called “poison pill” clause in financial jargon: the Californian group plans to sell off its shares for all other shareholders. It will be triggered if Elon Musk exceeds 15% of Twitter shares without the agreement of the board of directors (CA). Elon Musk owns just over 9% of the company’s capital at this stage.
If he buys back enough shares to reach the 15%, all the other holders of shares on the platform could buy back some at a reduced price, which would greatly increase the price the entrepreneur would have to pay to completely get his hands on the social network.
The plan is to “reduce the possibility that any entity, person or group will gain control of Twitter by accumulating stock in the market without paying all shareholders an appropriate premium or giving the board sufficient time to make informed decisions,” the San Francisco-based company said in a statement.
Twitter therefore intends to fight against this attempt by Elon Musk to buy it back to make it an unlisted company.
Challenged in court
“It was a defensive tactic that was predictable,” said Wedbush analyst Dan Ives. But it will not be perceived “positively” by shareholders, he predicts, given the risk of “dilution”.
And the plan will “certainly be challenged in court,” because the board has an obligation to act in the interests of the company and increase its value for shareholders.
Elon Musk on Wednesday presented a proposal to acquire the social network at a price that would value it at 43.4 billion US dollars, against about 36 billion at present. On Thursday, he said he had “sufficient funds” and assured that he had a plan B if the board refused his offer and not to seek “to make money”, during a live interview at the TED 2022 conference.
Very active on Twitter, where he has nearly 82 million subscribers, but also very critical of the network’s content moderation policy, he claims to want to make it “the platform for freedom of expression in the world”, with fewer limits on what users can write and post.
After repurchasing 73.5 million common shares of the company early last week, he was offered a seat on the board, but ultimately turned it down on Sunday after a series of suggestions for changes to the platform , such as the addition of an “edit” button or the removal of advertisements, Twitter’s main source of income.
Adept at polemics, provocation and dubious jokes, he also chained derogatory tweets, wondering if the network was “dying” because some very popular accounts publish little.
” Sore “
“I think it’s going to be quite painful and I’m not sure I’ll be able to buy it,” admitted the entrepreneur on Thursday, before explaining that he hoped to rally as many current shareholders as possible to his project. .
One of them has already reacted: the Saudi prince and investor Al-Walid bin Talal declared on Twitter that he “rejected” an offer that was too low compared to the “intrinsic value of Twitter”.
“Board members don’t want Musk because they disagree with him on just about everything and because his style doesn’t fit their corporate culture,” Dan Ives said in a published analysis. in the DailyMail Thursday. But the board won’t have many options, he said, because “Musk is as committed to running Twitter as SpaceX or Tesla.”