April 15 (UPI) — Twitter’s board of directors unanimously voted Friday to block Tesla and SpaceX CEO Elon Musk’s bid to buy the company for $43 billion, the social media giant said in a statement.
Twitter has adopted a “poison pill” strategy — formally known as a limited duration shareholder rights plan — to intercept a takeover by its largest shareholder.
On Thursday, Musk, who owns more than 73 million Twitter shares, offered to buy the remaining shares for $54.20 each and take the company private — a proposal he called his best and final offer.
“The Rights Plan is intended to enable all shareholders to realize the full value of their investment in Twitter,” the company’s statement reads.
It reduces the possibility of any entity, person or group gaining control of Twitter through open-market accumulation without paying each shareholder an appropriate control premium, according to the statement.
The board of directors must also be allotted enough time to “make informed judgments and take actions that are in the best interests of shareholders,” Twitter’s statement continues.
The poison-pill strategy gives a company’s existing shareholders an opportunity to buy discounted additional shares.
Twitter’s annual stockholders meeting is set to occur on May 25, and the Rights Plan expires on April 14, 2023.
