‘Poison Pill’ Measure Against Elon Musk from Twitter

Elon Musk, who became the largest shareholder of the company by buying 9.2% of Twitter shares on April 4, gave up on joining the board of directors for reasons that are not officially known. But yesterday, emphasizing that Twitter will not evolve with the current order, to buy the entire company for $43 billion made an official offer.

This possible acquisition, which will also turn Twitter into a private company, will undoubtedly be a very difficult decision for Twitter. Twitter, which has already decided to consult Goldman Sachs on Musk’s offer, according to The New York Times, Musk’s to make him withdraw the offer. will implement a strategy.

The main goal is to discourage Musk from buying Twitter:

According to the news shared by the New York Times, Twitter is trying to prevent Musk from buying the company. from a strategy known as the ‘poison pill’ will benefit. With this strategy, whose real name is the ‘shareholder rights plan’, Twitter management will have the opportunity to zero the chance of a shareholder – Elon Musk, for example – buying a significant amount of shares in the open market and forcing the company into a sale.

This strategy is widely used by companies that want to fend off unwanted takeover bids. The strategy of the company to fill the market with new stocks or potential buyer allowing existing shareholders to purchase discounted shares They’re giving permission. This makes the shareholder’s offer to buy all the shares more expensive. If we go with the example of Elon Musk; Musk had offered to buy the entire company at $54 per share. But as Twitter offers more shares to the market, Musk’s money will increase by $54 per newly released share.