Twitter’s board of directors has developed a plan aimed at preventing Ilon Musk from buying the social network.
The company announced a shareholder rights plan, better known in the financial world as the “poison pill.” The plan is a defense strategy that companies can use to protect themselves from hostile takeovers.
According to a company statement, the strategy will be in effect until April 14, 2023.
In essence, this approach allows shareholders to purchase additional corporate stock at a discount, effectively reducing the value of the stock and making it more expensive for a potential buyer.
Musk had previously purchased 9.2% of Twitter’s stock, and days later declined to join the company’s board of directors.
This week, the entrepreneur announced an offer to buy Twitter for $41.4 billion in cash.