Twitter Inc. adopted a measure that would shield it from hostile acquisition bids, taking steps to thwart billionaire Elon Musk’s unwelcome offer to take the company private and attempt to make it a bastion of free speech.
The board set up a shareholder rights plan, exercisable if a party acquires 15% of the stock without prior approval, lasting for one year only. The plan seeks to ensure that anyone taking control of Twitter through open market accumulation pays all shareholders an appropriate control premium, according to a statement Friday.
Twitter enacted the plan to buy time, according to a person familiar with the matter. The board wants to be able to analyze and negotiate any deal, and may still accept it.
The Tesla Inc. chief executive officer on Thursday offered $54.20 a share in cash for Twitter, valuing the social media company at $43 billion. Musk, who said it was his “best and final” offer, had already accrued a stake of more than 9% in Twitter since earlier this year.
Twitter’s board met Thursday to review Musk’s proposal to determine if it was in the best interest of the company and all of its shareholders.