Twitter Board Approves Poison Pill Plan to Fight Elon Musk’s Takeover
Twitter’s board on Friday approved plans to employ a poison pill defense to fight Elon Musk’s takeover of the company.
“The Rights Plan is intended to enable all shareholders to realize the full value of their investment in Twitter. The Rights Plan will reduce the likelihood that any entity, person or group gains control of Twitter through open market accumulation without paying all shareholders an appropriate control premium or without providing the Board sufficient time to make informed judgments and take actions that are in the best interests of shareholders,” the company said in its statement.
The poison pill is a tactic companies use in hostile takeovers to let the company offer new shares or shares at a discount to other buyers and shareholders. Twitter could use this while the board considers Musk’s proposal and any other potential offers, Mandeep Singh, analyst at Bloomberg Intelligence, previously told TheWrap.
“It is unclear whether the board officially asks or requests Elon to give a formal proposal on the changes that he wants to make in the company,” Singh said.
This comes as the Tesla boss on Wednesday filed paperwork offering to buy Twitter for $43 billion in cash after acquiring a 9.2% stake in the company earlier this month.
More to come …