Elon Musk is ‘talking to private equity investors to partner with him on a NEWLY structured bid for Twitter’ after board adopted a dramatic ‘poison pill’ defense to thwart his $43B hostile takeover
By HARRIET ALEXANDER
Elon Musk is reportedly talking with potential partners about joining him in a bid to wrestle control of Twitter, after the board poured cold water on his $43 billion offer and instead opted to take ‘a poison pill’.
Musk, 50, told the board on Wednesday he wanted to buy the social media company, in which he has a 9.1 percent share.
On Thursday, the CEO, Parag Agrawal, told staff that they were still weighing up Musk’s offer.
But on Friday, Twitter’s board announced the dramatic ‘poison pill plan’ to prevent Musk from further increasing his stake in the company.
Also known as a shareholder rights provision, the plan announced on Friday would trigger a dilution of company shares if any shareholder builds up a 15 percent stake without the board’s approval.
The plan does not prevent Twitter from accepting Musk’s offer or entering negotiations with him or other potential buyers – but it will stop the billionaire from putting pressure on the board by buying up ever more shares on the open market.
Musk, in response, is now said to be recruiting others to join his bid, the New York Post reported Friday night.
Musk, the world’s richest man, currently owns a 9.1 percent stake in Twitter and is seeking to take the company private with an unsolicited bid of $54.20 per share, well above Friday’s closing price of $45.08.
The Tesla CEO said on Thursday he could ‘technically afford’ the $43 billion price tag – Musk’s fortune is estimated by Forbes at $264 billion. Much of his wealth, however, is tied up in SpaceX and the electric vehicle company.
Musk currently has about $3 billion in cash or other somewhat liquid assets after spending $2.6 billion buying his 9.1% stake in Twitter in recent months, according to Bloomberg calculations.
The Post said sources close to the deal told them Musk was mulling partnering with private-equity firm Silver Lake Partners, which was planning to co-invest with him in 2018 when he was considering taking Tesla private.
The co-CEO of Silver Lake, Egon Durban, is a Twitter board member and led Musk’s deal team during the 2018 failed effort to take Tesla private, sources said.
Durban was described by The Financial Times in 2020 as ‘the first phone call for Silicon Valley companies in need of cash.’
An American citizen who was born in Germany and grew up in Texas, Durban lives with his wife, daughters and dog in the Silicon Valley suburb of Atherton – where neighbors include former Google chief executive Eric Schmidt and Golden State Warriors basketball star Steph Curry.
It is unclear if Musk and Durban are talking about sticking to Musk’s original takeover plan, or coming up with a new one…
