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Twitter is weighing a poison pill that would prevent Elon Musk from increasing his stake in the company significantly, a person familiar with the situation said.
The world’s richest man should be able to buy anything he wants. But can he buy Twitter.?
When Elon Musk lobbed in a $43 billion offer for Twitter, absent was any indication of how he might pay for it.
Would-be buyers—especially surprise ones who want to pressure a target’s board to capitulate—typically show up with the money in hand, or at least a guarantee from a bank that the funding will be there. Like so much else with Mr. Musk, however, the Tesla chief went a different route: His filing Thursday says only that the deal hinges on “completion of anticipated financing.”
Mr. Musk is very rich. His Tesla stake is worth some $176 billion. He has options to acquire millions more shares of the car maker. He also is founder of SpaceX, one of the world’s most valuable private companies. He could sell his stakes in those companies, but that would trigger big tax bills and reduce his control. Mr. Musk doesn’t take a salary from Tesla, and he has said in the past that he is cash poor.
Tesla allows executives to borrow against their stakes—but only up 25% of the value of the shares they pledge. Mr. Musk owned 172.6 million shares of Tesla as of Dec. 31, filings show, with options to acquire 60 million more.
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