Last week, Twitter ignored Musk’s bid to buy the company outright for $41 billion — it’s worth less than $36 billion. Instead the board of directors initiated…
What just happened? On Wednesday, Elon Musk filed paperwork with the Securities And Exchange Commission (SEC) stating that he has received funding to buy all of Twitter’s outstanding stock, which as of February 10, 2022, was 800,641,166 shares. Musk’s Schedule 13D amendment states that he has raised $46.5 billion in funding, more than enough for the entire purchase. Last week, Twitter ignored Musk’s bid to buy the company outright for $41 billion — it’s worth less than $36 billion. Instead the board of directors initiated a poison pill strategy to prevent him from executing a hostile takeover. The plan calls for Twitter to offer more stock to its shareholders if Musk acquires a 15-percent stake in the company, thus diluting shares and making a takeover much more expensive. Musk’s counter to the poison pill is to drive straight through to a tender offer. Usually, when a stakeholder gains 15-percent active interest in a firm, it can attempt a hostile takeover by paying other shareholders a premium price for voting shares (a tender offer).
