Twitter adopts ‘poison pill’ plan to restrict Elon Musk's takeover bid of firm

Twitter had said on Friday that its Board of Directors has unanimously adopted a “poison pill” in response to the Tesla and SpaceX CEO Elon Musk’s proposal to buy the 100% shares in the firm and hold it privately. The move is being labelled as a “limited duration shareholder rights plan.” It aims to make investors “realise the full value of their investment” and also restrict any other entity or a business from gaining control of the firm as it mandates them to pay the shareholders a "premium." Twitter will implement the plan in case Musk’s stakes in Twitter skyrocket above 9% to 15%. 

Plan 'doesn’t prevent the Board from engaging with parties'

Although Twitter is stating that the recently adopted plan “doesn’t prevent the board from engaging with parties or accepting an acquisition proposal if it’s in the company’s best interests,” according to news agency Associated Press. In the securities filing on Thursday, SpaceX boss Musk offered to buy the company for $43 billion. Musk's Twitter stock purchase took a whole new twist with the filing of a lawsuit charging him with breaches of compliance; it maintained that he purposefully and illegally delayed the process to disclose his stake in the social media giant so that he could buy more shares at a lower rate. Musk has utilised nearly USD 2.6 billion on Twitter stock which is the largest individual fortune in the world. The micro-blogging platform Twitter had also earlier said that it is evaluating tech billionaire Elon Musk's $43 billion offer. 

The social media company has responded to the Tesla CEO's "unsolicited, non-binding" offer and has agreed to look into it. Just a day later, one of Twitter's largest shareholders, Saudi billionaire Prince Al Waleed bin Talal, has rejected SpaceX and Tesla CEO Elon Musk’s $41 billion cash bid for a potential takeover of Twitter Inc. “I don’t believe that the proposed offer by Elon Musk ($54.20) comes close to the intrinsic value of Twitter given its growth prospects,” the Prince tweeted, making Musk question the Prince’s opinion on the subject of Freedom of Speech. Meanwhile, Elon Musk has repeatedly iterated that he intends to acquire Twitter to promote “free speech” which he says “is a societal imperative for a functioning democracy.” “I now realize the company will neither thrive nor serve this societal imperative in its current form,” he stated in the filing. 

Image: AP, Unsplash