Twitter has adopted a short-term plan for shareholders’ rights, often referred to as a “poison pill”, a day after billionaire Elon Musk made a aggressive $ 43 billion takeover bid, Twitter announced on Twitter. Friday, according to CNBC.
It is noted that the technique of “poison pills” is a maneuver aimed at preventing an attempt at an aggressive takeover, where the target company seeks to make it less desirable to potential buyers.
The board voted unanimously in favor of approving the plan.
Under the plan, if a person or group of individuals owns at least 15% of the common Twitter shares without board approval, the other shareholders will be able to buy additional discounted shares. The project is scheduled to expire on April 14, 2023.
Twitter noted that the plan would not prevent the board of directors from accepting a takeover bid if it deems it in the best interest of the company and its shareholders.
Twitter also hired JPMorgan as a consultant to respond to the offer.
Twitter, meanwhile, hired a second bank, JPMorgan Chase & Co., to help it respond to its takeover bid from Elon Musk, according to Bloomberg, citing sources familiar with the matter.
The largest US bank has recently begun work to help Twitter in talks with potential buyers, sources said on condition of anonymity because the matter is confidential.
Representatives of Twitter and JPMorgan declined to comment.
It is noted that in addition to Musk, interest in the acquisition has been expressed by other interested parties, including Thoma Bravo. According to the report, a company spokesman declined to comment.
With the acquisition of JPMorgan, Twitter is partnering with a bank that has not been afraid to confront Musk. Musk’s JPMorgan and Tesla have been involved in lawsuits. They are suing each other over stock transactions, some of which are linked to Musk’s 2018 tweet that he had secured funding to privatize Tesla, an effort that was abandoned weeks later.
In addition to JPMorgan, Goldman Sachs is helping Twitter with the issue. Morgan Stanley is working with Musk.
It is noted that Musk already owns more than 9% of Twitter, as revealed in documents of the Hellenic Capital Market Commission last week. Shortly after the announcement of his participation, the CEO of Twitter announced Musk’s plans to join the board. But a few days later, Musk changed his mind and decided not to join the board.
If he were to join the board, Musk would not be allowed to own more than 14.9% of the company’s common stock.
In a live interview at TED2022 in Vancouver on Thursday, Musk outlined his vision for making Twitter algorithms more accessible to the public and limiting content control.
He also acknowledged that he was not “confident” that he would actually be able to acquire Twitter, although he said he had “sufficient assets” to fund the deal if it were accepted. Despite his fortune, Musk has a large portion of his assets tied to shares in his companies, including Tesla, which means he will probably have to liquidate or borrow to pay the amount if his offer is accepted.
However, Musk said that there is a plan B, in case his initial offer is rejected. He declined to give further details.
Read also:
* Twitter: Musk’s bid not for hostage, CEO says
* Musk bid for Twitter’s $ 41.39 billion acquisition
Source: Capital
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