Attention is drawn to the ongoing takeover battle between Elon Musk, CEO of U.S. electric vehicle brand Tesla, and Twitter, a U.S. social media.
According to CNN and CNBC, Musk proposed to the U.S. Securities and Exchange Commission (SEC) on the 13th of this month to acquire Twitter for a total of $43 billion.
Earlier, he emphasized the freedom of social media expression through his Twitter account and mentioned the possibility of developing his own social media. Since then, he has bought about 9% of Twitter shares and later proposed an acquisition. Perhaps because of this, Musk also revealed his plan to convert Twitter into an unlisted company to make it an social media that allows freedom of expression.
Musk conducted his own investigation of followers through his Twitter account asking for and against Twitter’s making it an unlisted company. As a result, 2,859,000 people participated and 83.5% agreed.
In response to this move, Twitter’s board of directors implemented a “poison fill” strategy to prevent Musk’s attempt to acquire the company. Poison Peel refers to a system that gives existing shareholders the right to purchase shares at a much lower price than the market price in the event of hostile M&A (merger or merger) or attempts to infringe management rights.
If the system is implemented, existing shareholders can defend management rights by buying stocks with relatively little funds, while it will be difficult for those who are engaged in M&A to secure stakes.
Musk responded by saying, “After Twitter founder Jack Dorsey left the company, the board of directors as a whole has rarely owned shares in the company,” adding, “The profits of the board do not match the interests of shareholders.”
The market has various prospects for the attempt to acquire Twitter.
Musk’s $54.20 per share offer is higher than Twitter’s $45.08 as of the 15th, so it is predicted that the acquisition will be made, that it will be possible to raise the acquisition price more than $54.20, and that it will eventually fail due to internal opposition from the Twitter organization.
