Twitter announced this Friday that it intends to delay or prevent the purchase of the company by Elon Musk. And it will do so with an action known in the business world as a “poison pill”, which aims to complicate Musk’s purchase of more than 15% of Twitter shares.
“It just makes it that much more expensive for him to buy the company. That doesn’t mean Twitter won’t negotiate a deal with him, but it does give them a little more leverage and they can force him to increase his offer, even though he said 54 $.20 a share is his final offer. He’s a known changer, so he could come with a higher offer,” AP analyst Paul Harloff explains.
The Tesla billionaire currently holds a 9% stake. Twitter made this decision public a day after Musk offered $43 billion for the social network.
“This is almost a Twilight Zone moment for many on the street seeing something that is historic. I mean, Musk single-handedly trying to buy Twitter wasn’t in anyone’s playbook in 2022. But because of the question of freedom of expression, has become a controversial issue, in which Musk is trying, as the richest person in the world, to own Twitter,” says Dan Ives, an analyst at Wedbush.
Musk is threatening to sell all of his Twitter stock if his takeover bid is rejected.