Elon Musk, a famous billionaire and entrepreneur, issued a statement on Thursday that he has acquired commitment letters securing over $46.5 billion to be used in the purchasing of Twitter, and is looking into a bypassing workaround because f the fact that the board of directors for Twitter has been entirely unresponsive to the offer from Musk.
Musk stated via a securities filing that he looking into a tender offer “to acquire shares of Twitter directly from shareholders, though he said he hasn’t decided whether to do so,” read a report from The Wall Street Journal.
The board of directors from Twitter made a choice to adopt a “poison pill” in an effort to stop Musk from going through with his takeover.
The board made use of a “limited duration shareholder rights plan,” that lets Twitter’s existing shareholders, minus Musk, time to purchase additional shares at a large discount, read a report from Axios.
What the board members are attempting to do by this is dilute musk’s holding in the company, and make the overall cost of taking over the platform overtly expensive to the point of impractical.
At one point earlier in the week, Musk tweeted out a small clue concerning his next move in making a move to issue a tender offer, stating via a tweet “Love me Tender.”
🎶 Love Me Tender 🎶
— Elon Musk (@elonmusk) April 16, 2022
As reported by Corporate Finance Institute, this tender offer is a proposal from an investor to the current shareholders of a public traded company. “The offer is to tender, or sell, their shares for a specific price at a predetermined time,” stated CFI. “In some cases, the tender offer may be made by more than one person, such as a group of investors or another business. Tender offers are a commonly used means of acquisition of one company by another.”
Musk has issued comments against the Twitter board since his first offering to just outright buy the company and make it private.
Over the weekend Musk called out the board of directors for Twitter for “objectively” not keeping their “economic interests” in line with the shareholders of the company.
“Elon Musk is in for a bad time,” stated Christ Bakke, the founder of Laskie, in a post. “I’m not sure he’s prepared to take on a couple PhDs, a few MBAs, and a Baroness who use Twitter once a year (to reset their passwords) and collectively own 77 shares of the company.”
An image of the ownership of the various members of the board of directors for Twitter went along with Bakke’s statements.
“Wow, with Jack departing, the Twitter board collectively owns almost no shares!” stated Musk on Saturday. “Objectively, their economic interests are simply not aligned with shareholders.”