After becoming Twitter’s largest shareholder, Elon Musk, Tesla’s chief executive, is joining the social media company’s board of directors.
After becoming Twitter’s largest shareholder, Elon Musk, Tesla’s chief executive, is joining the social media company’s board of directors. By Lauren Hirsch Elon Musk is joining the board of Twitter. The company disclosed the news in a securities filing on Tuesday, one day after Mr. Musk revealed that he had bought a 9.2 percent stake in the social media giant, a purchase that appeared to make him its largest shareholder. The news sent Twitter’s shares skyrocketing more than 20 percent on Monday. Twitter’s stock rose more than 6 percent in premarket trading on Tuesday after the news of Mr. Musk’s board appointment. Mr. Musk had been quiet on his intentions for the purchase, which was worth about $2.9 billion before it was disclosed but has risen sharply in value since. He registered with a securities document called a 13G filing, indicating that he planned for the investment to be passive and that he did not intend to pursue a larger role in the company. Twitter’s Tuesday announcement said that there were no “arrangements or understandings” between Mr. Musk and Twitter that led to his director role. “It is theoretically possible” to have a passive stake in a company and join the board in a “passive monitoring capacity,” said Joshua Mitt, a professor of corporate law at Columbia Law School. But the presumption of acquiring a board seat would be to effectively affect change in the company, he said. “It doesn’t mean that you couldn’t try and convince the S.E.C. otherwise, but I think it would be an uphill battle,” Mr. Mitt said. Mr. Musk is set to be appointed to a board seat that expires in 2024. For as long as he is serving on the on the Twitter board, and for 90 days after if he chose to step down, he would not be allowed to own more than 14.9 percent of Twitter’s stock, either individually or as a member of a group. Jack Dorsey, Twitter’s co-founder, stepped down as its chief executive in November and plans to leave the company’s board when his term ends next month. “Through conversations with Elon in recent weeks, it became clear to us that he would bring great value to our Board,” Twitter’s chief executive, Parag Agrawal, tweeted on Tuesday. The filing detailing Mr. Musk’s investment in Twitter was dated March 14, which is the day he crossed the 5 percent threshold that required the disclosure. But he could have been buying up shares long before then. “Looking forward to working with Parag & Twitter board to make significant improvements to Twitter in coming month,” Mr. Musk tweeted in reply. Mr. Musk has criticized the company in recent weeks for failing in his view to adhere to free speech principles, and he has argued that users should be allowed to choose the algorithms that select the tweets they see or build their own, instead of relying on Twitter to curate posts. The idea was one Mr. Dorsey championed while leading Twitter. “The choice of which algorithm to use (or not) should be open to everyone,” he said last month in response to a tweet from Mr. Musk pushing for open-source algorithms. On Monday, Mr. Musk posted a Twitter poll asking users whether they wanted a long sought-after capability to edit tweets, perhaps a hint that he wanted to influence features offered by the company. “Do you want an edit button?” Mr.
