Monday, May 16

Elon Musk and Twitter: getting closer to Succession | Digital Trends Spanish


Elon Musk has clear intentions to take over Twitter, at least his most recent actions show it. A few days ago, the tycoon acquired 9.2 percent of the company in a transaction that cost him $2.9 billion. However, apparently this was not enough, because the entrepreneur now wants the microblogging platform in its entirety.

Musk, in a letter sent to investors, makes clear his intention to buy 100 percent of Twitter. In the document, filed with the United States Securities and Exchange Commission, the CEO of SpaceX offers $43 billion.

I made an offer https://t.co/VvreuPMeLu

— Elon Musk (@elonmusk) April 14, 2022

The interesting thing is that Elon Musk points out in the letter that it is his “best and last offer and, if it is not accepted, I would have to reconsider my position as a shareholder”, which has led to the emergence of several theories by those who analyze this strategy.

After acquiring 9.2 percent of Twitter, the South African became the main shareholder of the company. At that time, Musk shared his desire to be part of the board of directors, something that ultimately did not happen.

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hostile takeover

According to a report published by the magazine Fortune, the CEO of Tesla may consider a hostile takeover of Twitter after refusing to join the social platform’s board of directors. A hostile takeover is when you intend to buy a company, but you do not have the consent of those who run it.

Many fans of the series may remember this concept of SuccessionHBO’s hit drama which has shown that the main stakeholders in an acquisition can opt for a hostile buyout by acquiring a sufficient stake in the company, or through alliances with other stakeholders, which would allow them to obtain a controlling stake.

According to Fortune, if Musk had agreed to join the board of directors, he would have been capped at 14.9 percent of Twitter. The fact that you have rejected that option leaves you open to the option of a hostile takeover.

What can Twitter do?

The mess between both parties again approaches Succession. If Musk chooses the hostile buy, Twitter could artificially lower the cost of shares so shareholders can buy more shares at lower prices, allowing them to defend themselves against a takeover. Those of us who have seen the HBO series know that this strategy is known as a “poison pill” in the business world.

Despite threats from Elon Musk, this plot is still far from being resolved. One thing is clear: the tycoon is determined to keep 100 percent of Twitter and seems unwilling to accept other options. The resolution of this story is uncertain and keeps us all expectant, as if it were a television series.

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