On April 15, Twitter's board of directors implemented a so-called "poison pill program" to avoid Elon Musk. Elon Musk acquired the platform. It's a time-bound shareholder rights plan that prevents acquisitions against management's wishes, although whether this is in line with the wishes of all investors, not individuals, remains a big question mark.
On April 14, Musk is known to offer to buy the remaining stake in Twitter that he does not yet own at $54.20 per share. Musk tweeted, "The offer is his highest offer and final offer, and if it is not accepted, I will need to reconsider my position as a shareholder." ”
He also said he believes Twitter has extraordinary potential and that he will unleash it. Musk's main goal is to make Twitter a social media platform where free speech thrives.
Speaking recently at the TED Global Conference, founded by Chris Anderson, he said: "Twitter has become a kind of town square, so it's important for people to speak freely within the limits of the law."
However, Twitter's board of directors strongly opposed Musk's policies, and although for obvious reasons, they chose not to acknowledge it directly. To prevent the social network from becoming a platform for "free speech and prosperity," Twitter's board executed a so-called "poison pill project." On April 15, Twitter's board of directors unanimously voted to approve the plan, which will be valid until April 14, 2023.
What is The Twitter "Poison Pill Program"?
The "poison pill plan" is a defensive measure taken by the board of directors of listed companies to prevent hostile acquisition and dilution of shares. Although Twitter did not name names in the statement, the industry generally believes that the move is intended to block Tesla CEO Musk's acquisition intentions.
Twitter wrote in a press release that "the rights plan will reduce the likelihood that any entity, individual, or group of entities will gain control of Twitter through open market accumulation without paying an appropriate control premium to all shareholders, or without giving the board enough time to make informed judgments and take actions that are in the best interests of shareholders." "
"If an entity, individual or group acquires 15% or more of Twitter's issued common stock in a transaction not approved by the Board, the entitlement plan will take effect." Under the entitlement plan, other shareholders will be allowed to purchase additional common stock shares at 50% of the market price. The entitlement program will last for one year and expire on April 14, 2023. ”
Twitter also said more details about the program would be submitted to the SEC, and the 8-K filing has not yet been made public. Musk has not responded to this as of the time of the small day, but he has previously said that he still has "Plan B".