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Twitter to name top shareholder Musk to board
Date Added: April 05, 2022 02:19:41 PM
Author: Sutra Web Directory
Category: Internet

Twitter Inc (TWTR.N) said on Tuesday it would name top shareholder and Tesla (TSLA.O) boss Elon Musk to its board, a day after the billionaire disclosed a significant stake in the social media company.

The appointment may temporarily block chances of an immediate takeover bid from Musk, something that analysts and investors had speculated after he reported a 9.2% stake, worth about $3 billion.

Musk cannot own more than 14.9% of Twitter's common stock either as an individual shareholder or as a member of a group as long as he is the director of Twitter, the company said in a filing.

"I'm excited to share that we're appointing @elonmusk to our board," Agrawal said in a tweet. "He's both a passionate believer and intense critic of the service which is exactly what we need on @Twitter, and in the boardroom, to make us stronger in the long-term."

In response, Musk tweeted: "Looking forward to working with Parag & Twitter board to make significant improvements to Twitter in coming months."

Musk, who calls himself a free-speech absolutist, has been critical of the social media platform and its policies, and recently ran a Twitter poll asking users if they believed the platform adheres to the principle of free speech.

After disclosing his stake on Monday, Musk put out another poll on Twitter asking users if they want an edit button, a long-awaited feature on which the social media platform has been working.

"You can never underestimate Elon Musk. I wonder what the underlying motives are?" said Gerald Goldberg, CEO of GYL Financial Synergies, a registered investment adviser, whose clients own both Twitter and Tesla shares.

"I think he's sending a message to the SEC that says, 'I'm going to do what I want to do'."

Twitter shares surged 6% in trading before the opening bell, after closing up over 27% on Monday.

Musk, a prolific user of Twitter, has made a number of announcements to his over 80 million followers on the social media platform, including his intention to take Tesla private that landed him in trouble with the U.S. Security and Exchange Commission.

On Monday, Musk disclosed his ownership of 73.5 million Twitter shares, which are held by the Elon Musk Revocable Trust, of which he is the sole trustee.

Musk will participate in the director benefits arrangements applicable to non-employee directors and serve as a Class II director, with the term expiring at Twitter's 2024 annual meeting of stockholders, the company said.

The world's richest man will also be a board member of UFC-owner Endeavor until June 30 but has exited the board of tech non-profit OpenAI, which he co-founded, in 2018.

He is also the founder and CEO of SpaceX, and leads brain-chip startup Neuralink and infrastructure firm the Boring Company.

Reporting by Nivedita Balu in Bengaluru, Additional reporting by Chavi Mehta; Editing by Anil D'Silva

~ Via Reuters