If you can’t take the heat, just buy the kitchen. Elon Musk’s stormy relationship with Twitter changes daily. Determined to be the person steering one of the world’s most influential social media platforms, the billionaire CEO of Tesla has offered to buy Twitter for $54.20 a share. Musk, who is already Twitter’s largest shareholder, was recently entertaining joining the board, and then in an abrupt about-face, he tweeted that the company should consider converting its headquarters into a homeless shelter (a jab at the company’s policy allowing remote workers.)
Twitter confirmed in a press release that it received Musk’s offer and said the board of directors “will carefully review the proposal to determine the course of action that it believes is in the best interest of the Company and all Twitter stockholders.” -Yahoo Finance
There is a significant backstory between Tesla and Twitter; according to Russ Mitchell of the Los Angeles Times, there is precise recorded history on November 7, 2013, where eight Twitter accounts cropped up in just 75 minutes and turned the tide in Tesla’s favor after it was reported that a line of Tesla cars were catching on fire.
“After buying nearly 10% of Twitter last month, Musk announced that he’d be joining the board, but Twitter revealed Monday that he’d changed his mind for unspecified reasons. Musk is a Twitter phenomenon, constantly posting tweets for his 80 million followers that range from standard to outrageous to juvenile to profane.” Russ Mitchell, Los Angeles Times
But why does Musk want Twitter? And why does he want to make it a private company? A portion of his SEC Filing reveals the following:
“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.”
How does Twitter’s board feel about Musk’s attempt at a buy-out?
Twitter’s board responded by unanimously approving what is known as a “poison pill,” a plan which gives the existing shareholders the opportunity to buy stocks at a steep discount. This plan shows that Twitter’s board is setting up to fight Musk’s hostile takeover.
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The following are some documents from the RealDealDocs database pertaining to Tesla, Twitter, and Buy-Out agreements:
Royalty Buy-Out Agreement for EXACT SCIENCES CORP, Exact Sciences Corporation, MDxHealth SA, Oncomethylome Sciences, SA
Twitter for COMSCORE, INC., Cerberus Capital Management, Charter Communications, @Qurate Retail, Inc, Social Media
Image courtesy of Iván Jesus Rojas.