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Twitter rolls out plan to use poison to block Elon Musk’s attempted hostile takeover

Twitter has announced a new shareholder rights plan in a move known as poison pill, as a way to block Elon Musk’s $41 Billion Acquisition Offer. The plan, as reported by The Vergewould allow certain shareholders to buy more shares in response to anyone trying to gain control of the company through the open market.

The move was announced in a Twitter press release, said the Twitter board approved the plan in response to “an unsolicited, non-binding proposal to acquire Twitter.” Listed in the press release as a limited-term shareholder rights plan, the campaign is known to the financial world as a poison and is rarely carried out, and even rarely activated.

The plan will remain in effect next year and will only be implemented if Musk acquires more than a 15% ownership stake in the company. If the plan goes through, Musk will have to spend increasingly large sums of money to maintain a majority stake in the company – although the billionaire has hinted that he may be willing to throw growing amounts of cash at the company. .

Elon Musk’s history with Twitter has come a long way, but recently gained prominence when he quietly became the company’s largest shareholder. He initially accepted a seat on the company’s board on condition that he could not purchase more than 15% of the company’s shares, but he later rejected the offer and launched a hostile takeover bid. enemy.

Musk has criticized the prospect of the board going against his offer, saying it “would be completely unacceptable not to put the offer to a shareholder vote”, and has threatened to sell devalue its shares in the company if the offer is not accepted. In an interview with TED, Musk said that his plans for Twitter involve maintaining the platform as a place for free speech.

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