In the event of a takeover: Musk wants to cut the salary of the board of directors of Twitter

Status: 19/04/2022 08:25

The rush to take over the short message service Twitter continues. Tesla boss Elon Musk, who is meeting resistance on Twitter with his takeover plans, has announced that he wants to cut Twitter’s board salaries to zero.

The dispute between Twitter and Elon Musk over the takeover of the company is entering the next round. Musk has announced he will cut executive salaries to zero if his bid is successful.

Ironically, Musk approached the company’s board via Twitter over the weekend, which he wants to take over for around $43 billion. “(Twitter) executive’s salary will be $0 if I’m successful,” Musk tweeted on Monday. “So that’s $3 million a year that we’re saving here.” Musk responded with the tweet to a post from another user who had criticized the Twitter forum.

Poison pill to make it harder to take control

However, Parag Agrawal, the CEO of the company, is not listed in the salary table discussed in the tweet. Twitter founder and former boss Jack Dorsey has received no regular compensation in the past year. Dorsey is one of the largest shareholders in the company with around 2% of the shares.

Musk already owns around 9% of Twitter and wants to take over the company completely. Twitter’s board isn’t keen on this and has reacted with a so-called “poison pill”. On Friday, Twitter announced the launch of a frequently used procedure that aims to make it more difficult for large investors to increase their stake: the countermeasure provides that other shareholders can buy additional shares at a lower cost if a buyer exceeds the 15% mark.

More bidders for Twitter in sight?

Plus, another bidder could apparently be racing for Twitter dominance. According to a report by Reuters news agency, which quotes an insider, technology-focused investment firm Thoma Bravo has informed Twitter that it is also considering a bid for the company. However, it is unclear how high that could be and whether it will happen at all, the source said, according to Reuters. Thoma Bravo declined to comment on this.

According to a press report, the American financial investor Apollo could also want to be involved in a takeover of the short message service Twitter. The company is considering backing either tech billionaire Elon Musk or another bidder with capital or loans as part of a bid, according to The Wall Street Journal (“WSJ”). The financial investor has also bet on a possible cooperation between its Internet service Yahoo and Twitter. Apollo had acquired Yahoo from the American telecommunications group Verizon.

The stock market doubts the takeover by Musk

The takeover of Twitter by Elon Musk is still viewed with skepticism on the stock market. Shares of Twitter rose 3.5% to $46.68 in US trade yesterday. That’s well below the $54.20 Musk is offering per share.

Musk himself has admitted doubts. “I’m not sure I can buy it,” he said last Thursday. However, the 50-year-old stressed that he “technically” had the necessary funds to complete the case, which is worth more than 40 billion dollars (37 billion euros).

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