In recent times, if you want to ask what is the most concerned about the world's Internet industry? Musk's large-scale acquisition of Twitter is undoubtedly one of the best, as the world's richest man to acquire one of the world's largest social media, this acquisition war is enough to attract attention, more interesting is that this acquisition is not a peaceful acquisition, Musk refused to join the Twitter board, began to become the door of the barbarian "hostile takeover" direction of development, how do we look at this matter? Why is Twitter using poison pills against Musk? Why does Twitter hate being bought by Musk so much?
First, Twitter wants to use poison pill strategy against Musk?
According to the Wall Street Journal website reported on April 14, Elon Musk's conflict with Twitter has lasted for a week. Musk has launched an all-out offensive to buy the company and warned that he could sell his stake in the social media service if refused.
The Tesla company chief bid $43 billion to buy Twitter on Thursday morning, the latest development in the world's richest man and Twitter's saga about "whether he will act." Musk disclosed an offer in an application filed with the SEC at $54.20 per share.
On April 15, Twitter urgently passed the Limited-duration Shareholder Rights Plan to fend off Musk's $43 billion hostile takeover plan, according to The Paper.
According to Bloomberg's April 16 and 15 reports, this "rights plan" proposed by Twitter's board of directors is a "poison pill strategy." This strategy allows existing shareholders the right to purchase additional shares at a discounted price, effectively diluting the ownership interests of the adversary. When a listed company is attacked by aggressive investors or bought with hostility, "poison pills" are a common tactic.
According to the National Broadcasting Corporation Business Channel (CNBC) reported on the 15th, according to Twitter's "poison pill" strategy, if any individual or group obtains at least 15% of the beneficial ownership of Twitter's issued shares without the approval of Twitter's board of directors, other shareholders will be allowed to purchase additional shares at a discounted price.
Twitter said that the above -mentioned "poison pill" plan will last until April 14 next year, for a period of about one year. According to Bloomberg, people familiar with the matter revealed that Twitter hopes to buy the company a little more time to consider through this plan. Twitter's board did not completely rule out accepting the acquisition.
Musk, meanwhile, is not completely without rivals, and saudi prince Al-Walid, one of Twitter's shareholders, rejected Musk's $43 billion acquisition of Twitter because it believed the offer was "less than Twitter's intrinsic value." Musk asked how much Twitter he held.
Seeing that Musk wants to acquire Twitter on a large scale, coupled with Twitter's direct use of poison pill strategy to counteract, many people are asking Musk why he wants to buy Twitter? And why does Twitter hate Musk's acquisition so much?
Second, why does Twitter hate being acquired by Musk so much?
To be honest, for most Chinese, affected by the media publicity, Musk has been crowned the title of "Silicon Valley Iron Man", all the way from the head of a company to the world's richest man, Chinese for Musk is generally a relatively positive attitude, but why does Musk's acquisition of Twitter trigger such a big backlash? What should we think about this?
First, why musk would buy Twitter at any cost. Speaking of Musk's interest in Twitter, we must start from Musk's attitude to Twitter, as we all know, Musk is a famous entrepreneur, but his identity as an Internet celebrity V is not bad at all, on March 26, Musk said "Do you need a new social platform?" The tweet, in turn, opened his stake battle with Twitter. However, if you want to talk about the origin, the reason why Musk took a shot at Twitter this time is that Twitter drove away its former boss and Twitter founder Jack Dorsey last November, and Dorsey and Musk have a very bad relationship, and the two often interact on Twitter, which has also become the basis for Musk's large-scale use of Twitter. According to statistics, Musk has more than 80 million followers on Twitter, and has released more than 15,000 tweets in the past 10 years, the most popular topics of which are SpaceX and Tesla, in a sense, Twitter has become a tool musk uses to govern the company. So, the reason why Musk bought Twitter at any cost is simple:
The first is to avenge the snow hatred for friends. Dorsey was driven away by capital, so that Musk, who is also the founder, has a feeling of rabbit death and sorrow, vowing to avenge his brothers, which can be said to be Musk's most superficial reason, although as a business leader, it seems that it is not quite right, but Musk still has sufficient reasons to do so, and it is also in line with his usual personality.
The second is to further get the dividend of Twitter. As the world's richest man, if Musk's behavior is just a matter of will, it is impossible, if Musk wins Twitter, it means that he has got the super large traffic social platform he has been using before, if he can divert Twitter's traffic to many of his own companies is undoubtedly beneficial, naturally it is in line with Musk's fundamental economic interests.
The third is to avoid the risks you once took. Previously, Musk said too many things that should not be said because of his frankness on Twitter, and even was once punished by the US SEC, which once led to Musk not even being the CEO of Tesla, if Musk won The Twitter, it will undoubtedly be able to effectively avoid such a phenomenon from happening again.
Second, why does Twitter hate Musk's acquisition so much? Originally as a well-known Internet company, being acquired by the world's richest man seems to be a good choice, why does Twitter hate being acquired so much? In fact, the reason is that if you think about it, you will know:
One is that Musk came to avenge Dorsey, since Musk's name is this, then once he realizes the acquisition of Twitter, the first thing he does is definitely to remove the management of Twitter, combined with Musk's previous repeated twitter only Dorsey is a competent manager, then the current Twitter management will definitely be changed by Musk. Therefore, the current Twitter management will definitely try to resist Musk's acquisition.
Second, the price given by Musk is not low, but it is not high, the purchase price given by Musk is actually not particularly high for a world-famous social software, it can be said that it is a general price, to know that in 2021, Twitter has reached a high price of more than eighty US dollars, so the purchase price given by Musk at this time is actually not too high.
Third, Musk's characteristics are the supremacy of heaven and earth, once Musk takes power of Twitter, Twitter may currently have to change from management to ordinary employees, and it is relatively difficult to adapt to Musk's style, which is why Twitter has to resist Musk's acquisition.
Third, what tactics will Twitter use to resist Musk? Speaking of hostile takeovers and anti-takeovers, I believe that Chinese are most familiar with the battle between Baoneng and Vanke, but it can be said that the eight immortals have shown their magic across the sea, and now Twitter is also on the cusp of that, and the possible methods it may adopt We have seen the poison pill plan, increasing Musk's cost by effectively diluting equity, in addition to what other tactics? At present, there are still many ways to play on Twitter, in addition to poison pills, there are:
One is the White Knight strategy. The so-called White Knight is to find a large company to act as a good-faith acquirer as a White Knight, to compete with Musk, so that Musk will eventually lose. However, as the world's richest man, how many white knights in the world can compete with Musk? This is a relatively large unknown, unless it is a super-rich person like Bezos who has a considerable conflict with Musk, so the White Knight strategy, although effective, is not easy to implement.
The second is the scorched earth strategy. The so-called scorched earth strategy is to divest the most popular part of the company, making the acquisition meaningless, but for Twitter, the scorched earth strategy can actually operate in a limited space, after all, Twitter is a social media business, and it seems that it is not easy to divest it.
The third is the strategy of golden parachute and silver parachute. The so-called golden parachute, silver parachute strategy is to give corporate executives, middle managers extremely high compensation, to increase the cost of the acquirer, thereby reducing the desire to acquire, but this strategy is used is to let the current Twitter managers relatively get more compensation, for Musk, the world's richest man who is not bad money, the golden parachute, silver parachute strategy is better than nothing.
Therefore, we can analyze that the current Twitter acquisition of Musk is undoubtedly to resist to the end, but the real effective strategy is actually very limited, if the poison pill is cracked by Musk, how many other strategies are useful? It's still an unknown, but for now it's certainly a wonderful takeover war that deserves our continued attention.