Industry

Twitter adopts 'poison pill' to fight Elon Musk takeover

Elon Musk’s twitter account is seen on a smartphone in front of the Twitter logo in this photo illustration taken on April 15, 2022.

Elon Musk’s twitter account is seen on a smartphone in front of the Twitter logo in this photo illustration taken on April 15, 2022. | Photo Credit: REUTERS

Twitter Inc. on April 15 adopted a limited-duration shareholder rights plan to protect itself from billionaire entrepreneur Elon Musk’s $43 billion cash takeover offer.

Mr. Musk made the bid on April 13 in a letter to the board of Twitter — the micro-blogging platform that has become a global means of communication for individuals and world leaders — and it was made public in a regulatory filing on April 14.

After his TED talk on April 14, Mr. Musk hinted at the possibility of a hostile bid in which he would bypass Twitter’s board and put the offer directly to its shareholders, tweeting: “It would be utterly indefensible not to put this offer to a shareholder vote.”

Under the plan, also known as a ‘poison pill’ strategy to resist a bid from a potential acquirer, the rights will become exercisable if anyone acquires ownership of 15% or more of Twitter’s outstanding common stock in a transaction not approved by the Board.

The rights plan will expire on April 14, 2023, Twitter said.


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Printable version | Jun 16, 2022 6:53:29 pm | https://www.thehindu.com/business/Industry/twitter-adopts-poison-pill-to-fight-elon-musk-takeover/article65324883.ece