San Francisco — Bright, early Monday, Elon Musk sent amazing things to the government New document..
In it, the wealthiest man in the world showed his possible intentions for Twitter. Accumulate 9.2% stakeEmphasize how dramatically his position has changed from a week ago.
According to a document filed with the Securities and Exchange Commission, Mr. Musk was able to buy more shares of Twitter and increase ownership of the company if he chose. He was free to express his views on Twitter on social media and other channels, the document said. And he reserved the right to “change his plan whenever he thinks it is appropriate.”
It was a promise — or perhaps it was a threat. In any case, this filing encapsulates the dangerous situation Twitter is currently facing. Musk, 50, Twitter’s largest shareholder and one of the most well-known users, was able to use the social media platform very well for himself and even buy enough stock. .. He takes over the company.
“Twitter has always suffered more than a significant portion of its dysfunction,” said Jason Goldman, a former Twitter board member and board member of Twitter’s founding team. “But at least it wasn’t actively controlled by future board members using the products we created.”
The filing continued a week of high stakes drama between the millionaire and the company. Last Monday, Twitter revealed that Mr. Musk was currently accumulating more than $ 3 billion worth of stock in the company.The next day he was invited to Twitter 11 board And they agreed not to own or take over more than 14.9% of the company.Then on Sunday, Twitter suddenly said All those bets were off And Mr. Musk will not be the director.
It’s unclear exactly what happened between Musk, who has more than 81 million followers on Twitter, and the company’s executives and board members. But it leaves Twitter to a different activist investor, overcoming the founder’s struggle, boardroom rebellion, and the wrath of outside shareholders.
Musk, who heads electric car maker Tesla and rocket company SpaceX, is known for being unpredictable and candid, and often uses Twitter to criticize, insult, and troll others. I have. By not attending his board of directors, he freed himself from corporate governance rules that would require him to act in the best interests of the company and its shareholders.
Mr. Musk was free to devote himself after his decision was communicated to the company on Saturday morning. He declared “goblin mode” on Twitter and suggested changes such as removing the “w” from the company name to make it vulgar, and opening a San Francisco headquarters to protect the homeless. He later deleted some posts.
“This isn’t typical activism, and frankly, it’s not like the activism we’ve seen so far,” said Ele Klein, co-chair of the global shareholder activist group at law firm Schulte Roth & Zabel. increase. “Elon Musk doesn’t do things people haven’t seen before.”
Patrick Gadson, co-head of shareholder activist operations at another law firm, Vinson & Elkins, said he was sympathetic to Twitter. “I never want the director I represent, or the director, to have to deal with this situation,” he said.
Mr. Musk did not respond to the request for comment. He didn’t directly mention the situation on Twitter’s board, but liked tweets suggesting that the company wanted to limit his right to free speech.
Twitter CEO Parag Agrawal hinted at how Mr. Musk had to act as a “company trustee.” post on Sunday. Twitter, which disclosed Mr. Musk’s career as a member of the board, was still visible at the end of Sunday, but declined to comment on Monday.
For a long time, Musk has significantly downplayed the rules of corporate governance. In 2018, he faced the crime of securities fraud after inaccurately tweeting that he had secured funds to keep Tesla private.Mr. Musk agreed to pay later $ 20 million fine Moved to SEC and will serve as Chairman of Tesla for three years.
He also agreed to allow Tesla to review his official statement about the company.But in 2019, the SEC asked the judge to insult him. Violate the terms of the settlement By accidentally continuing to tweet about Tesla.
Inside Twitter on Monday, employees were disappointed and worried about Mr. Musk’s disgust, according to half a dozen current and former workers who are not allowed to speak publicly. After a millionaire suggested that Twitter turn its headquarters into a homeless shelter on weekends because “nobody appears anyway,” employees think that Mr. Musk hadn’t visited the building for a while. I was wondering if I knew it.They also have Mr. Musk Net worth Is fixed at over $ 270 billion and can afford to help the San Francisco homeless themselves.
Others say Musk is angry with tweets criticizing the company’s products and business model, and he hasn’t appreciated the time and thoughts to update Twitter’s services over the years. Said that he had no knowledge of the product roadmap. Some employees were relieved to read that Mr. Musk would not join the board, according to someone who saw internal communication on Twitter.
When Mr. Musk was still expected to join the board, Mr. Agrawal scheduled a question-and-answer session for Mr. Musk to address employee concerns. Those who knew the decision said the session was cancelled.
Musk’s push is the first time Twitter has traded with activist investors in two years. Investment company in 2020 Elliott Management He accumulated a 4% stake and used that position to seek changes such as the expulsion of Jack Dorsey as Chief Executive Officer and more aggressive financial growth. Dorsey resigned In November.
Elliott’s approach follows the typical formula of activist investors. After acquiring a significant stake in a company, raise the stock price in search of changes in governance and strategy.
Rich Greenfield, an analyst at LightShed Ventures, a venture capital investment fund, said: But, “We don’t know what the real motive of Elon Musk is. Do you enjoy this Elon? Is this Elon trying to make a difference? This Elon is trying to increase inventory Are you there? “
According to analysts, Twitter is particularly vulnerable to activists. That’s because the founders of Twitter didn’t structure their stock to give them more control. The founders of Google and Facebook maintain their voting rights in stocks and give them an oversized grip on the direction of their company.
Natasharam, managing partner of Arjuna Capital, an activist investment firm that owns Twitter shares, said Musk has taken a more casual approach than other activist investors.
“Musk uses Twitter to listen to his opinions, but it’s not a core activity,” she said. “It’s like what he’s doing for fun.”
You may find that what is fun for Mr. Musk is not so much fun for Twitter. The relief that he stopped joining the board was short-lived among Twitter employees, and current and former employees agreed that he would not buy additional shares or buy the company. He said he realized he was no longer detained.
Mr. Musk was able to continue messing around with Twitter, current and former employees said they noticed. Some added that they were afraid of what would happen next.
Lauren Hirsch Report that contributed.