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| Elon Musk and the whirlwind of Twitter news. Source: Fox News (Creative Commons License). |
If you use Twitter regularly or have any internet connection at all, there is no way you would have missed the drama involving Twitter, the social media platform, and one of its most prolific users, Elon Musk. Whether that move is buying vast amounts of company shares, joining the Twitter board, surveying his Twitter followers if Twitter headquarters should be repurposed as a homeless shelter, or outright buying the company altogether!
He is undoubtedly one of the most unpredictable men there is, so we will give you all the details and timeline of this Twitter takeover.
Elon Musk Becomes Largest Individual Twitter Shareholder
Twitter algorithm should be open source
— Elon Musk (@elonmusk) March 24, 2022
Musk asked whether people wanted an edit button, and needless to say, the majority wanted the feature. An edit feature has been one of the most requested features on the platform, but the company has steadfastly refused to allow it.
Do you want an edit button?
— Elon Musk (@elonmusk) April 5, 2022
Although, Musk was not the largest Twitter shareholder. That title belonged to The Vanguard Group with more than 10 percent. The entity is owned by many investors, and all of them are part-owners of Twitter. In comparison, Jack Dorsey, former CEO of Twitter, owns only 2.4 percent and has announced he is leaving the Board when his term ends.
Meanwhile, Steve Westly, a former member of Tesla’s Board, has warned Twitter executives to get ready to work at Musk’s pace when he joins Twitter’s Board. While he admitted Musk could be irascible, Westly predicted Twitter would be better for it.
Elon Musk Turns Down Offer to Join Twitter Board.
With more than 9 percent of Twitter shares under his control, Musk is entitled to a seat on the company’s Board. The CEO, Parag Agrawal, did mention Musk would be given an invitation.
Musk, however, turned down the offer to join the Board on the day his appointment was scheduled to take place. The Tesla CEO did not give a reason for not joining, and neither did Agrawal in his message announcing the decision.
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| ABC7 News reporting on Elon Musk's decision to turndown a board seat. Source: ABC 7 News (Creative Commons License). |
Joining the Board would have given Musk more opportunity to influence decisions at the company, which he seems eager to do. Before making the decision, he had said he was looking forward to working with the Board to make significant changes to the social media platform.
Meanwhile, Musk continued to make rather outlandish suggestions for the future of Twitter. He has raised the idea of converting the company’s headquarters to a homeless shelter as few people show up there anyway. He also suggested that users who pay for the Twitter Blue service get the verification badge.
However, one of Twitter’s rules for its board members gave a hint for a reason behind Musk’s change of heart. Anybody sitting on the Board is not allowed to buy more than 15 percent of the company’s shares.
That could have been seen as a sign that Musk wanted to buy more shares or wanted to offer to buy out the company as a whole. Which is precisely what he did.
Musk Offers to Buy Twitter for $43 Billion.
When Musk turned down the offer to join Twitter's Board, many people scratched their heads. He didn't give a definite reason, but his following action revealed what he was thinking.
The billionaire tendered an offer to buy Twitter for $43 billion. He would have been unable to do so if he had accepted to sit on the Board because of the provision preventing Board members from owning more than 15 percent of the company.
Musk did not elaborate on how he would obtain the cash to purchase Twitter. This is significant since most of his wealth is tied up in the stocks of the other companies he runs. He doesn't even draw a salary from any of the companies he runs.
When Musk turned down the offer to join Twitter's Board, many people scratched their heads. He didn't give a definite reason, but his following action revealed what he was thinking.
The billionaire tendered an offer to buy Twitter for $43 billion. He would have been unable to do so if he had accepted to sit on the Board because of the provision preventing Board members from owning more than 15 percent of the company.
Musk did not elaborate on how he would obtain the cash to purchase Twitter. This is significant since most of his wealth is tied up in the stocks of the other companies he runs. He doesn't even draw a salary from any of the companies he runs.
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| Inside The Twitter Headquarters in San Francisco. Source: Tamer Abu-Dayyeh/Built-in (Creative Commons License). |
The billionaire tendered an offer to buy Twitter for $43 billion. He would have been unable to do so if he had accepted to sit on the Board because of the provision preventing Board members from owning more than 15 percent of the company.
When asked why he was interested in owning Twitter, Musk claimed he was not in it for the money or profit. He wanted to protect free speech, as the current Twitter management was not doing a good job at it. He has referred to himself as a free speech absolutist.
Free speech is essential to a functioning democracy.
— Elon Musk (@elonmusk) March 25, 2022
Do you believe Twitter rigorously adheres to this principle?
However, the Board rejected Musk's offer to buy 100% of the company, with at least one shareholder stating that the proposal by Musk "did not account for the company's potential growth."
The Board knows Musk will not give up even after his proposal is rejected. To protect the social media platform from a hostile take-over, the Board set a maneuver that would make it difficult for a single person to buy up a large percentage of the company's shares.
The Board knows Musk will not give up even after his proposal is rejected. To protect the social media platform from a hostile take-over, the Board set a maneuver that would make it difficult for a single person to buy up a large percentage of the company's shares.
This is called a poison pill. A poison pill allows shareholders to buy more shares at a reduced cost, successfully diluting the new, opposing party's ownership stake.
Musk said he had a plan B should his offer be rejected, which he thankfully didn't have to execute.
Musk said he had a plan B should his offer be rejected, which he thankfully didn't have to execute.
Elon Musk Buys Twitter.
On April 26th, 2022, it was announced that Elon Musk had successfully struck a deal to acquire Twitter, thus bringing Elon one step closer to fulfilling his dreams for what he envisions for the future of Twitter.
There's much controversy on many sides of the takeover. Some stated the considerable benefits to Elon having full ownership of Twitter. Others cited the dangers he could cause by taking such a public platform used for discourse and discussion private.
The arguments for interfering in future elections and markets with Elon's unpredictable behavior cause concern for some. Still, many believe that Musk's dedication to free speech has made it clear that the future Musk hopes to build for Twitter will be one of inclusion for all to discuss freely.