Source: World Nation News
On Tuesday, April 19, Florida Governor Ron DeSantis threatened Twitter Inc at a press conference. He said that the will try and hold the company’s board of directors responsible for their poison pill defence. Twitter had adopted this strategy against the potentially hostile acquisition fro Elon Musk. The poison pill is also know as the shareholder rights plan. It includes the diluting of the value of each share of a company by enabling existing shareholders to purchase more stake a lowered price.
Essentially, this would dilute the holding of the Tesla CEO who currently holds 9.2% stake at the company. Twitter hopes to appear as a rather unattractive target for takeover to starve off the unsolicited emphasis of Musk to acquire the social media company. According to Bloomberg, Florida’s state pension fund holds stake in Twitter Inc. As of December 31, 2021, it holds around 949,690 shares in the social media company. DeSantis expressed how he thought that it is ‘injury’ to the fund. Crucially, they are looking at ways to hold the board ‘accountable’ for adopting the strategy.
“I think that’s probably an injury to the fund, so we’re gonna be looking at ways that the state of Florida, potentially, can be holding this Twitter board of directors accountable for breaching their fiduciary duty,” DeSantis said.
Musk proposed a host of changes he would bring to Twitter Inc if he gets to acquire it. Specifically, he stated he will not go on paying the board members of the company. The members currently earn a total of $3 million, where each individually earns a salary somewhere between $250,000 and $300,000. He said this step would save ‘$3m/ year” on the spot. He went on to attack the board even further when he said that the ‘economic interests‘ of the board do not align with that of the shareholders of Twitter.
Last week, the Tesla CEO offered to buy the social media company for $54.20 per share, $43 billion in total. He made the offer to the board chairman Bret Taylor in a letter. As a defence, Twitter stepped forward to adopt its strategy to starve off this hostile takeover.
The entire fiasco has visibly taken on a political spirit because of the positing by Republicans like DeSantis. He said that the board targets keeping Musk away from Twitter over concerns of free speech. DeSantis pointed out how the board refused it because they are aware “that they can’t control Elon Musk.”
