On Thursday, April 14th, Elon Musk announced an offer to buy Twitter for $54.20 a share
The day after Musk announced his proposal to buy Twitter, the company’s board responded with a poison pill. This is basically the board’s way of saying, “Thanks, but no thanks.”
Elon Musk took a swipe at the board of Twitter after the social media company adopted a "poison pill" to protect itself from the second-biggest shareholder's $43 billion cash buyout offer.
Musk, a self-described "free speech absolutist" who has been critical of Twitter's policies, did not elaborate on the tweet.
Twitter’s board of directors says it adopted a “poison pill” defense in order to protect the social media platform from “coercive or otherwise unfair” takeover tactics.
The poison pill is a common nickname for a shareholder rights plan, which allows shareholders to buy additional shares of a company’s stock at a discount, diluting the value of each individual share. A company concerned about an unwanted corporate takeover will put the plan in place and, after a triggering event—in Twitter’s case, if one person buys 15% of the stock without the board’s approval—all other shareholders will be afforded the opportunity to buy up more shares. Musk currently owns 9.2% of Twitter.
“The effect of the agreement may be to “render more difficult or discourage a merger, tender or exchange offer or other business combination involving the company,” the filing said.