SAN FRANCISCO — Twitter moved Friday to block tech baron Elon Musk’s proposed takeover of the social media firm, adopting a technique often known as a “poison pill” that is usually used to intercept hostile company bids.
The Twitter board of administrators voted unanimously to undertake the technique, which is formally often known as a shareholder rights plan, the corporate stated in a assertion posted on-line.
“The Rights Plan will reduce the likelihood that any entity, person or group gains control of Twitter,” the San Francisco-based firm stated.
Several news organizations together with Bloomberg had reported Thursday that the Twitter board was contemplating the poison-pill defense. The technique permits current shareholders apart from the individual making an attempt the takeover to purchase further shares at a reduction, diluting the fairness of somebody like Musk.
Musk on Thursday introduced a suggestion to purchase Twitter in a $40 billion deal that might take shares of the corporate’s inventory off public markets and provides Musk full management. He stated Twitter’s guidelines for on-line speech had develop into too burdensome, choking off some public debate that needs to be heard even when it is hate speech.
Twitter didn’t touch upon the small print of Musk’s proposal, and the corporate saved open the potential for reaching a deal for a potential takeover.
“The Rights Plan does not prevent the Board from engaging with parties or accepting an acquisition proposal if the Board believes that it is in the best interests of Twitter and its shareholders,” the corporate stated.
Twitter’s annual shareholder assembly is scheduled for May 25, an occasion that would present one other discussion board for Musk to air his grievances or search to affect Twitter’s path.