Twitter Re-Examines Elon Musk's Bid, May Be More Receptive to a Deal (1 hr ago, WSJ) [View all]

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Twitter Re-Examines Elon Musk’s Bid, May Be More Receptive to a Deal
Two sides are meeting Sunday to discuss takeover bid, people familiar with the matter say

https://www.wsj.com/articles/twitter-re-examines-elon-musks-bid-may-be-more-receptive-to-a-deal-11650822932

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Twitter is expected to weigh in on the bid when it reports first-quarter earnings Thursday, if not sooner, the people said. Twitter’s response won’t necessarily be black-and-white, and could leave the door open for inviting other bidders or negotiating with Mr. Musk on terms other than price. Mr. Musk reiterated to Twitter’s chairman Bret Taylor in recent days that he won’t budge from his offer of $54.20-a-share, the people said.

The potential turnabout on Twitter’s part comes after Mr. Musk met privately Friday with several shareholders of the company to extol the virtues of his proposal while repeating that the board has a “yes-or-no” decision to make, according to people familiar with the matter. He also pledged to solve the free-speech issues he sees as plaguing the platform and the country more broadly, whether his bid succeeds or not, they said.

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Mr. Musk already has said he is considering taking his bid directly to shareholders by launching a tender offer. Even if he was to get significant shareholder support in a tender offer—which is far from guaranteed—he would still need a way around the company’s poison pill, a legal maneuver it employed that effectively blocks him from building his stake to 15% or more.--snip--
One oft-employed tactic to push a bid, seeking to gain control of the target’s board, is out of reach for now. Twitter’s directors have staggered terms, meaning a dissident shareholder would need multiple years to gain control rather than a single shareholder vote. Twitter tried last year to phase out the staggered board terms given that they are frowned upon by the corporate-governance community, but not enough shareholders voted on the measure. The company is attempting to do so again at this year’s annual meeting set for May 25. Only two directors are up for re-election, and it is too late for Mr. Musk to nominate his own.

Twitter’s shares have been trading below his offer price since he made the bid April 14, typically a sign that shareholders are skeptical a deal will happen, though they did close up roughly 4% Friday at $48.93, the day after he unveiled financing for the deal. He has indicate