(Slay News) – Tech entrepreneur Elon Musk has reportedly put the next stage of his bid to take over Twitter into action, which he previously dubbed his “Plan B.”
Musk has now entered into talks with investors about joining his bid to purchase the social media platform after the Twitter Board of Directors enacted a “poison pill” to try and stop the takeover.
According to the New York Post, sources familiar with the matter revealed the partnership could be announced in a matter of days.
Musk initiated a bid to take over the social media giant earlier this week with an offer of $54.20 per share for all of Twitter’s shares, a bid worth more than $40 billion.
He made the move after revealing that he’d bought a staggering 9.2% of the company, making him the largest shareholder.
Sources told the Post that one of Musk’s partners could be Silver Lake Partners.
Musk has worked with the company in the past and it is co-run by one of the members of Twitter’s board of directors.
As the New York Post reported:
One possibility, the sources said: teaming with private-equity firm Silver Lake Partners, which was planning to co-invest with him in 2018 when he was considering taking Tesla private.
Silver Lake’s Co-CEO Egon Durban is a Twitter board member and led Musk’s deal team during the 2018 failed effort to take Tesla private, sources said. Silver Lake declined to comment.
News of Musk’s strategizing comes after the Twitter board inserted a “poison pill” in its bylaws to stave off Musk’s hostile takeover, as Slay News first reported Friday.
The Twitter board passed a shareholder rights plan on Friday that would allow board members to purchase additional stock at a discount if a single entity purchases a total of at least 15% of Twitter’s stock.
A poison pill allows other shareholders – but not the would-be buyer – to scoop up newly minted shares at a discount, boosting their investments while forcing the target to swallow “economic poison” by having his shares diluted.
The move is an unmistakable signal that the board is not interested in the prospective hostile acquirer, despite a potential profit for shareholders.
If the maneuver succeeds, shareholders are certain to flood the courts with lawsuits, accusing the directors of Twitter of breaching their fiduciary duties.
There are three possible outcomes now, none of which are ideal for Twitter’s current board:
Musk could win by successfully initiating a proxy contest to remove the directors and nix the poison pill
Musk forces the company to find a “white knight,” or alternative buyer, potentially at a higher price, thus making his shares more valuable
Musk walks away and leaves the company and the bo