On Sunday, April 10, Twitter CEO Parag Agrawal tweeted that Elon Musk will not be joining the social media company’s board of directors.
This comes less than a week after he was offered a seat after becoming Twitter’s largest shareholder.
Elon has decided not to join our board of directors. I sent a briefing note to the company, sharing with you all here. pic.twitter.com/lfrXACavvk
– Parag Agrawal (@paraga) April 11, 2022
On April 4, the CEO of Tesla acquired a 9.1% stake in Twitter. The company then announced that he would be named to the 12-member board of directors pending a background check and formal acceptance.
This post, which was not of the first order, would have been made official on Saturday 9 April. That morning, Musk notified Twitter that he would not accept it. He did not give specific reasons for changing his mind.
This comes a few days after consuming musk He indicated his pleasure About joining the board, he wrote on Twitter “I look forward to working with the Parag & Twitter board to make significant improvements to Twitter in the coming months!”
Musk participates in Twitter is no longer limited
According to his agreement for a seat on the board, Musk’s stake in Twitter would have been limited to 14.9% or less of the common stock during his tenure, and for 90 days thereafter.
The position would also have come with a fiduciary duty to act in the best interests of the company and its shareholders, and Musk would have been publicly criticize platform in the past.
By declining the seat, Musk is no longer constrained by any of these requirements. However, as Agrawal noted in a memo sent to the company, “Elon is our largest shareholder and we remain open to his input.”
The Tesla CEO is now free to criticize the platform
On the same day, he notified Twitter of his refusal. Musk suggested For his 81 million followers, the platform may be dying.
in a Two of his tweets have since been deleted Over the weekend, Musk directed more criticism at Twitter. One of the tweets suggested that the company’s headquarters in San Francisco be converted into a homeless shelter, and another suggested that everyone involved Blue Twitter An authentication check mark must be given.
What does this mean for the future of Twitter?
Musk no longer has a cap on the number of shares he can own, which opens the door to a hostile takeover. As the richest man in the world, he has the resources to buy any stock that hits the market.
In the wake of these advertisements, Twitter share price It fluctuated wildly, rising as much as 30% after news of Musk’s acquisition, followed by another 10% when his appointment to the board was announced. After news of its reversal, shares fell as much as 4% in pre-market trading Monday before rebounding slightly.
Agrawal’s statement indicated that the repercussions of Musk’s actions could cause deviations within the company, but insisted that goals and priorities remain unchanged.
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