Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

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Who is richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

 

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

 

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

The plot is the same as when Tesla took over.

The first step is to become a major shareholder of Twitter, and the next step is for ElonMuskIt's time to launch a general attack on the social networking giant.

According to a document filed with the U.S. Securities and Exchange Commission, Musk has launched a takeover bid yesterday, April 13 U.S. time Twitter's board of directors wantsAcquired Twitter for $54 per share and took the company private.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Earlier this month, Musk spent $2.89 billion to acquire 9.2% shares of Twitter Inc. and became the largest shareholder. In fact, his move to increase his stake in Twitter began in mid-March and has been going on for more than half a month, but was only officially announced on April 4, catching the Twitter board off guard.

Yet Musk is not content to be the majority shareholder: this wholly owned acquisition we are discussing today means that Musk plans to take over the company in its entirety.

"I invested in this company because I believe in its future as a platform ...... but I now realize that this company in its current state is not going to grow and serve society as a whole," said Musk in a letter to Twitter Chairman Bret In a letter to Twitter Chairman Bret Taylor, Musk wrote, "Twitter needs to be changed in a private way."

The same drama as when he took over Tesla in a strong way.

Musk has decided to buy all the shares of the company twitter for $54.2, which is expected to cost a total of $43 billion. Musk believes that the takeover, and the price of $54, is the best possible outcome for the company's board of directors and other investors."This is my final offer and if it is not accepted, I will reevaluate my status as a shareholder."

Speaking to the New York Times, former SEC Chairman Robert Jackson Jr. said that once again there was a delay in disclosure in this Musk acquisitionUnder U.S. takeover laws, Musk's approach could involve a hostile takeover, in which an investor secretly hoards a company's stock and launches a takeover bid for the company on that basis.

Other investors are also making their move: Vanguard suddenly increased its stake to 10.3% this afternoon, April 14, U.S. time, temporarily overtaking Musk and reclaiming its seat as the top shareholder.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Musk's vicious twitter takeover today makes this chart look more like reality than a terrier image Source: Daily Wire

But according to Musk's own logic, he feels that this is not a hostile takeover, but rather a "change in Twitter".

No one on the outside knows what Musk meant by the phrase "reassessing our status as shareholders. But in another filing with the SEC, a phone call between Musk and Twitter Chairman Bret Taylor was recorded.

Musk stated.

  • This time is to come to the serious acquisition, completely without the idea of playing tai chi with the board of directors, there is no other available means.
  • The price is already very suitable, the shareholders will be satisfied (subtext: don't give shame?)
  • Have absolutely no confidence in the current management of Twitter.
  • Acquisition is only plan A. If it is rejected, one has plan B.
  • This is not a threat, one truly believes that if one has invested in the company, one must see this company move forward for the better, however, in its current state (including as a public company) this is not possible, so it must be privatized and delisted.
Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

"Twitter has a lot of potential and I will unlock it," Musk wrote in the letter.

Despite being caught off guard by Musk's sudden increase, Twitter's board and management have publicly welcomed him, and Twitter CEO Parag Agrawal invited him to join the board, though Musk declined.

In reality, however, the battle for control between Musk and Twitter has been going on since he suddenly announced the results of his increase half a month ago. Beneath the surface peace, there are undercurrents - and a number of dramatic events, both big and small, have occurred in the meantime.

Today, let's take a look back at Musk's "serial" fight for control of Twitter.

Low profile increase and start acting

As we previously reported, Musk actually started the process of increasing his stake in Twitter on March 14 of this year, exactly one month ago.

For ease of understanding, we will refer to the March acquisition of 9.2% as the "first investment".

His lawyers filed a petition with the SEC on March 14 to increase his stock holdings. The filing shows that he plans to acquire 9.2% shares of Twitter Inc. as a passive investment. Passive investing, also known as static investing, literally refers to maximizing returns by minimizing buying and selling.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Photo credit: SEC

If we look at the definition of passive investment, Musk's first investment in Twitter means that I am bullish on the company and I want to add its shares to my asset allocation portfolio strategy.

(Of course, according to today's plot, this first investment is not really a "pure" static investment ......)

According to public information, Twitter's largest institutional shareholders were previously Vanguard Group (8.39%), Blackrock Fund (4.56%), SSgA Fund (4.54%), Aristotle Capital Management (2.51%) and Sister Wood's ARK Investments (2.15%). .

Co-founder and former CEO Jack Dorsey's current equity is only 2.25%, which has been continuously diluted in the process of financing, IPO, and later cashing out, and without the protection of similar dual/three share mechanism, he has lost his voice in the company's decision making, which is why he has "left" the company twice at the request of the board of directors. This is why he has "left" the company twice at the request of the board of directors.

Musk, who is also a member of the "PayPal gang" and has a good relationship with Jack Dorsey, suddenly became the largest shareholder after his first investment, with his shareholding level rising to 9.2%.

Vanguard also increased its stake this afternoon US time and now holds about 10.3%, leaving Musk in second place for now.

What makes people laugh is that, like Vanguard, BlackRock and other top institutions with hundreds of billions of dollars of assets under management, they were suddenly set up by Musk; and considering that Jack Dorsey has been very low-key in recent times, he basically didn't make any public comments on Musk and Twitter's drama. -The Musk's play also seems to be a bit to the good brother revenge meaning?

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Musk and Dorsey are rumored to be very close, but they haven't really been seen together. Above is a video conversation between the two at a previous Twitter conference.

Or back to Musk himself: in mid-March began to increase the code, only announced in early April, the first investment in the secret conservative for a full half month, according to Musk's character, how could he hold back?

In fact, some of his actions on Twitter during that half month, if you think about what happened later, you can only say "No wonder ......"

On March 25, he posted a poll on his account asking his followers: "Please vote, do you think Twitter is following the "Free Speech" principle? As a result, more than 2 million people voted, with 70% saying Twitter was not up to par on this point.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Before that, Musk's various public statements had foreshadowed his desire to do something related to social networking. So after he tweeted the following, many people thought for a while that he was going to start a business.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

After the vote, Musk also pretended to ask the question of heaven: Since Twitter is doing so badly, what should we do?

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Who would have thought that just a week after this March 26th tweet, Musk himself would become the largest shareholder of Twitter ......

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Board seats, don't even bother!

Now that it's out in the open, Twitter has to respect the new majority shareholder, who can kill itself.

Twitter CEO Parag Agrawal took to his personal account to congratulate Musk on joining the company and invite him to join its board of directors.

"I am very excited to share with you that we are appointing Musk to the Board! In conversations with him in recent weeks, we have become increasingly confident that he will bring tremendous value to the Board."

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

And subsequently, the company also filed documents with the SEC for the appointment.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

It is worth noting thatJoining the board already exceeds the definition of a "passive investment". So that's why many observers believe that Musk has used the passive investment name before, just to minimize his shareholding plans (and further "schemes") from being noticed by Twitter's board and management in advance.

He didn't want to be in a "passive" position in this case. If the story of the takeover of Tesla teaches us anything, it must be that this man will take the initiative no matter what, he will not just be a mere investor.

In response to some media questions about whether Musk himself would receive special treatment on the platform, Twitter has since publicly stated that he would not receive any special treatment, either as a board member or as a regular user.

Twitter really does what it says on the tin.

After his first investment, Musk continued to post a variety of opinions and discussions (not the least of which were confusing remarks) on his personal account.

As a result, it wasn't more than a week before he deleted them all.

At the same time, Twitter also made a sudden announcement that Musk did not want to be a director of the company.

"His appointment was supposed to become official on April 9. However, on the same day he told us that he would not be joining the company's board. I believe this is the best possible outcome," Agrawal wrote.

This last sentence is so interesting: "I believe this is the best possible outcome."--The best outcome for whom? Surely not Musk, after all, for Twitter, he has long been full of complaints, has long wanted to have a vote belonging to their own voice, otherwise he would not suddenly increase stock holdings, and today suddenly launched a wholly owned acquisition of the company well.

Perhaps the "best possible outcome" is for Twitter's board of directors, other shareholders and management.

Agrawal's official statement on Musk not serving as a director: "The board and I, as well as Elon himself, have had many discussions about his joining. We are very excited about working together and know exactly what the risks are. We also had confidence that if Elon serves as a fiduciary for the company (one of the directors with financial oversight responsibilities), he will protect the interests of the company and all shareholders, just as all other board members do."

From these statements, the rumors that Musk deleted many of his tweets related to Twitter after his first investment because he received a gag order from Twitter's board are more credible. After all, as a major shareholder of the company, and even as a future board member, he really shouldn't make statements that are detrimental to shareholders' rights.

Although he deleted the tweets, his like list became a treasure: in those days, he liked some tweets that seemed to suggest that his heart for the good of Twitter had been taken by the board as a wolf's heart.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse" Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

It's not over.

Two days after "politely declining" an invitation to join the board, Musk's attorneys updated the SEC on April 11 with their shareholding paperwork.

This time the document added a phrase. A sentence that, in today's view, has very far-reaching implications.

"(In addition to the previous arrangements ...... the filer will reserve the right to amend the shareholding plan at any time ......"

In the context of Musk's statement, this means "I may continue to increase my stake in the future."

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

As expected, three days later, on April 13, Musk launched a general attack on Twitter.

His price of $54 per share is indeed higher than Twitter's share price in recent times, so on the face of it, Twitter's other shareholders do stand to gain more from the deal if it goes through.

However, the board members and other influential major shareholders do not see it that way.

On Thursday today, Twitter's board of directors issued an announcement that it had received an "unsolicited, non-binding takeover and going private offer" from Musk and that it would be handling the matter exclusively.

At the same time, some shareholders have already started their own "anti-horse" actions.

As we mentioned earlier, Vanguard has increased its stake to 10.3% this afternoon, temporarily regaining the largest shareholder seat.

Also today, the company's longtime investor, Saudi Prince Alwaleed bin Talal, spoke out through his Twitter account, saying that Musk's offer of $$54 was not consistent with the company's "intrinsic value" given Twitter's long-term prospects. (intrinsic value). And he and his Saudi royal holding company, KHC, rejected Musk's offer outright.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Several shareholders have also joined together to launch a lawsuit against Musk, alleging that his late disclosures violated securities trading-related laws and caused damages to Twitter shareholders. U.S. law requires public disclosure within 10 days if a listed company's shareholders increase their holdings beyond 5%, and Musk was a full half month late.

In addition to the suspicious delay in disclosure, there is also analysis by legal experts that Musk's acquisition may constitute a bad faith takeover bid in violation of the Williams Act. The act is one of the amendments to the U.S. Securities and Exchange Act that specifically protects investors from acts like this one by Musk.

A classic definition of bad faith takeover behavior is the secret hoarding of stock, as Musk did, for the purpose of launching a takeover of a company with coercion after the fact. Such behavior, which prevents other investors from knowing exactly how a company's holdings have changed and thus from protecting their investments in a timely manner, is indeed illegal by legal definition and is generally avoided by well-intentioned acquirers. However, given the unique nature of the situation, similar acquisitions have occurred in the past.

Although the deal is not good for everyone, Musk has made up his mind to go down a road to black.

Today, the annual TED conference was held in Vancouver, Canada, and Musk happened to be one of the guests in attendance.

Who's richer? Musk 43 billion to "buy twitter" but the majority shareholder teamed up to "resist the horse"

Image source: TED

On stage, he shouted directly to investors.

"I definitely want to keep the other existing investors, but (if the investors don't buy in) I could theoretically have the money to buy out all of their shares."

He was asked what he would do if the offer was eventually rejected by Twitter, and Musk said there was no way to answer that question yet.

But he made it clear that he still had plan B.

 

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