Twitter Inc. announced the name of Elon Musk to its Board after it was disclosed that the CEO of Tesla Inc. was the largest shareholder of the social media company, as per Bloomberg News.
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This appointment ends the chances of a takeover of Twitter by Musk and capping his ownership to 14.9% during his tenure on the Board as per the filing with the Securities and Exchange Commission Tuesday. Currently, Musk owns 9.2 % of Twitter shares which jumped 7% in New York after the market opened.
Musk tweets regularly and is one of the most prominent personalities on Twitter. He regularly runs into trouble with his tweets, and musk is looking to exit from the 2018 deal with SEC that controls his tweets regarding Tesla.
CEO Parag Agarwal is excited about Musk joining the Board of Twitter. The intentions of Musk with Twitter are not yet clear through his affiliation with the social media company has been beneficial for the beleaguered company, whose prices have tumbled since the 2021 record as investors are wary of the high valuation and poor user growth.
Twitter share rose by 27% yesterday as buyers bet Musk can use his clout to jumpstart Twitter. He is presently the biggest shareholder and an influential member of the platform, with a following of 80.4 million.
Dan Ives, an analyst with Wedbush Securities, in a note to investors, said that the friendly move by Twitter to embrace Musk with open arms is the start of Musk’s involvement with Twitter. The joining of Musk to Twitter will lead to a strategic initiative in short- and long-term possibilities for the company, which is struggling in the social media race.
Twitter has earlier been mocked for having a board member who hardly tweeted. Musk has been controversial on the Twitter platform. He tweeted, and name called a British Cave Diver as a “pedo guy,” leading to a defamation lawsuit.
Musk asked the Twitter users on Monday whether they wanted an edit button. He polled in November last year, asking the Twitter users whether he should sell 10% of his stake in Tesla Inc., supported by the majority.
Jack Dorsey, the co-founder of Twitter, has stepped down as CEO of Twitter last year and will leave the Board after his term ends this year; Dorsey, who is Musk’s friend, tweeted that he was happy to join the Board.
Elon Musk’s existing board positions include Tesla Inc. and Space Exploration Technologies Ltd, the two high-profile organizations he leads. Last month, the Hollywood entertainment company Endeavor Group Holdings Inc. disclosed that Musk was resigning from its Board.
Musk Term on Twitter’s Board will expire at its 2024 annual meeting.
