Entrepreneur Elon Musk set the internet ablaze on Sunday night after Twitter, which he recently became the largest shareholder of, announced that he had declined their offer to join the company’s board.
“Elon Musk has decided not to join our board,” Twitter CEO Parag Agrawal said in a statement. “We announced on Tuesday that Elon would be appointed to the Board contingent on a background check and formal acceptance. Elon’s appointment to the board was to become officially effective 4/9, but Elon shared that same morning that he will no longer be joining the board.”
“There will be distractions ahead, but our goals and priorities remain unchanged,” Agrawal later added. “The decisions we make and how we execute is in our hands, no one else’s. Let’s tune out the noise, and stay focused on the work and what we’re building.”
Shortly after the announcement was made, Musk tweeted out an emoji of a face with a hand over its mouth, which usually means “to cover your mouth, not to speak, to mute” and is typically used to “express emotions of rapture, smirk, shy smile, or happiness.”
However, Musk later deleted the tweet.
Elon Musk deleted this cryptic tweet after it was announced he won’t be joining Twitter’s board of directors… pic.twitter.com/kmag7cprMp
— Joseph A. Wulfsohn (@JosephWulfsohn) April 11, 2022
After becoming their top shareholder with control of more than 9% of the company, Musk signed an agreement with Twitter for the following terms as long as he served on their board: “Mr. Musk agrees that, for so long as Mr. Musk is serving on the Board and for 90 days thereafter, Mr. Musk will not, either alone or as a member of a group, become the beneficial owner of more than 14.9% of Company’s common stock outstanding at such time, including for these purposes economic exposure through derivative securities, swaps or hedging transactions.”
Since Musk declined to join the board, he is not bound by any restrictions on how much of the company he can buy, journalist Yashar Ali noted.
“Hostile takeover inbound,” Austen Allred, CEO Bloom Institute of Technology, tweeted. “My read of this: (I’m guessing). 1. Twitter board wakes up to realize Elon owns 9% of the company. There’s a path to him taking over. 2. Offers a board seat contingent upon him not buying too many shares. Try to contain. 3. Negotiations break down on term details. 4. ???”
Matt Bilinsky, a business attorney, suggested that the reason Musk did not join Twitter’s board was because he would not have been able to say much about the company publicly. “Since the Board announcement he’s been crowdsourcing ideas and chatting via Twitter,” he tweeted. “He quickly realized that’s all over as soon as he actually joins the Board and tapped out.”
I’d bet anything it was this.
Since the Board announcement he’s been crowdsourcing ideas and chatting via Twitter.
He quickly realized that’s all over as soon as he actually joins the Board and tapped out. https://t.co/NDolsbF9tO
— Matt Bilinsky (@mattbilinsky) April 11, 2022
“One board seat doesn’t translate to much power,” another account noted. “Only if you have majority control can you fire management and change a company’s direction. Seems like this was lost on many people. Musk may want more than 15%. If so, the poison pill plan is underway to block him.”
One board seat doesn’t translate to much power. Only if you have majority control can you fire management and change a company’s direction. Seems like this was lost on many people. Musk may want more than 15%. If so, the poison pill plan is underway to block him.
— FischerKing (@FischerKing64) April 11, 2022