Under the “poison pill” strategy, the rights become exercisable if someone acquires ownership of 15% or more of Twitter’s outstanding common stock in a transaction not approved by the board of directors
Under the “poison pill” strategy, the rights become exercisable if someone acquires ownership of 15% or more of Twitter’s outstanding common stock in a transaction not approved by the board of directors
Twitter Inc. passed a limited-term shareholder rights plan on April 15 to protect itself from billionaire entrepreneur Elon Musk’s $43 billion cash tender offer.
Mr Musk made the offer on April 13 in a letter to the board of directors of Twitter – the microblogging platform that has become a global means of communication for individuals and world leaders – and it was disclosed in a regulatory filing on April 14.
Following his April 14 TED talk, Mr. Musk hinted at the possibility of a hostile bid in which he would bypass Twitter’s board of directors and make the bid directly to his shareholders, tweeting, “It would be absolutely unjustifiable to do this Offer not to be made Shareholder vote.”
Under the plan, also known as the “poison pill” strategy, to resist an offer from a potential acquirer, the rights become exercisable if someone owns 15% or more of Twitter’s outstanding common stock in a non-dated Board-approved transaction.
The rights plan expires on April 14, 2023, Twitter said.
