12 ms·

I don’t understand how any board can implement a “poison pill”, not just Twitter but Netflix and others, and not be found working against the interest of shareh

I don’t understand how any board can implement a “poison pill”, not just Twitter but Netflix and others, and not be found working against the interest of shareholders. Can anyone help me understand? You’re categorically changing the profile of the stock. This has a chilling effect on large investors, including but not limited just to Musk, right? Correct. Hence the term poison pill. Now nobody else will be interested in buying them either and Elon selling out will tank the stock. As a reminder their stock steadily dropped all the way to $14 after the initial IPO pop and they've been losing money since before Covid. Woke means broke I guess. I think his plan B will be to start a competitor. I'm very tempted to heavily short as soon as he walks away definitively. As to your question of, won't the other shareholders get mad at the board and potentially sue them - I think the board is drinking their own koolaid.

quest88 5y ago
He can buy one of those other competitors used by right-wing folks. Hell, if "free speech" is so important to him and to everyone else he wants to rescue he can just tweet to use those other platforms. It's certainly cheaper.
- recuter 5y ago
  Twitter is "losing hundreds of millions of dollars every year" (I don't know if that's how we're using air quotes now, just following your lead), it is already circling the drain. No need to buy anything, it would be trivial for him to setup a clone and fund it indefinitely while it tears itself apart.
  - threeseed 5y ago
    Revenue grew 37% since last year. And they were profitable when you exclude their once off litigation expense. Not sure about your definition of circling the drain but Twitter definitely isn't.
- Hamuko 5y ago
  Spoiler alert: other platforms are not in any way more "free speech". Gab for example bans porn, which is both free speech protected by the First Amendment, and allowed on Twitter. TRUTH Social seems to forbid a lot of things, such as depictions of violence, lewd content, libelous/slanderous content and lying (true to their name, I guess?).
- PKop 5y ago
  Twitter is where the network effect and users are, so no it makes more sense to take over Twitter and shape it to your own views if you are a billionaire who wants to make an impact on public discourse and free speech.
Cookingboy 5y ago
>Woke means broke I guess. That sentence alone means you weren't even discussing this in good faith. It's very well possible that the Twitter board believes that they can achieve higher value for the shareholders than what Elon offered. It's also very well possible that after talking to Elon through private conversations that you were not part of, they fundamentally disagree with his value and the direction he wants to take the company. >I think his plan B will be to start a competitor. Hey, maybe he would buy Parler, that would sure get him all the attention he desperately craves for. /s but maybe not.
- recuter 5y ago
  > That sentence alone means you weren't even discussing this in good faith. Is that what good faith means now? Being religiously part of Camp A or B? The balance sheet speaks for itself. Incidentally Parler or his potential Twitter clone will also end up a toxic internet community. Who cares? I personally wouldn't use either one. Certainly with Twitter already doing a great job losing money and alienating most people (almost nobody actually tweets and usage is falling) an alternative would split the user base and accelerate their demise and the inane concept of web micro-forums being worth tens of billions of dollars. Companies will simply decide advertising on Parler/Twitter is not worth the hassle.
  - Cookingboy 5y ago
    >Is that what good faith means now? Being religiously part of Camp A or B? No. But you immediately made this into a Camp A vs. Camp B problem when in reality there could be a million different reasons for the Twitter board to not want to get acquired means you weren't trying to discuss this specific situation, you were looking to turn this into a debate on "wokeness". That's why I said you weren't discussing in good faith. >The balance sheet speaks for itself. Does it? Elon has seen the same balance sheet and he thinks the true value of the company is higher than what it is now as well. So obviously he thinks Twitter has the potential to achieve much higher value through implementing XYZ. The board agrees too but just disagree on what that XYZ is.
    - 5y ago
pcmoney 5y ago
Poison Pills are rarely exercised, this is a positional move. Unlikely Elon is the only interested party at this point. If the board can use a pill to force a slower buy-out discussion and negotiation it is very much beneficial to shareholders. Their stock price was over $70 in the trailing 12 months. Even with Elon's offer they are still worth 10 NFL teams combined. I can find zero credible evidence to support your position. Please short the stock :)
- recuter 5y ago
  I wasn't aware NFL teams was a unit of measurement. One has to wonder if you think I am wrong why you wish for me to short the stock and lose my shirt.
  - deleted 5y ago
    [deleted]
  - deleted 5y ago
    [deleted]
threeseed 5y ago
a) The poison pill only affects those who are looking to control the company in some way. Which isn't most large investors at all. So I doubt you will find any who will be concerned by this. b) Twitter's stock price is now $45, peaked at $77 only last year and is profitable. Not sure where you get this ridiculous idea the company is unsellable. c) There are plenty of free speech competitors to Twitter. None are even remotely successful. Because as Reddit also showed far more people want a moderated experience more than those that don't. And Twitter is a business first and foremost. d) Musk is offering shareholders a premium as the stock is today. But as I mentioned even just last year it was significantly higher. And so I can't imagine shareholders would have an issue about them turning it down if they believed Twitter was still continuing to head in the right direction as it is now.
- SilasX 5y ago
  >The poison pill only affects those who are looking to control the company in some way. Which isn't most large investors at all. So I doubt you will find any who will be concerned by this. That's not the right way to think about it. Anything that scares off ambitious, optimistic activists from buying big stakes, will then suppress the stock value in general, which hurts all shareholders, including the smaller ones. More broadly, going public is a tradeoff. You potentially give up control to outsiders, in return for greater share value (and the cash infusion). Moves like this go the opposite direction: decrease the potential for outside control, and with it, the upward pressure on the stock's value.
version_five 5y ago
> I think his plan B will be to start a competitor I hope it isnt: I think that starting a top down, meaning "look I built this, everyone move over from twitter", competitor has a very low probability of success, regardless of who starts it. There is too much of an attack surface, there will be too much drama on real Twitter about it, early adopters will be gun nuts or some other out group and that will be how they get characterized, etc etc. The real chance at a competitor would be something that grew organically, that people wanted to move to because it offered something valuable before it reaches scale. This is how actual businesses start. The top down approach is how massive flops happen. Incidentally, the same holds true for the Facebook metaverse and imo suggests it will certainly fail
- ratboy666 5y ago
  Remember that this IS Musk; not very predictable. But I'm going to try... Since Musk has stated that this was NOT to make money, I imagine that triggering the poison pill, and THEN dumping the shares would tank the stock. Musk did say "final offer, and if rejected, re-evaluate". The poison pill trigger? Not something talked about. I hold some shares of TWTR, and would continue. For the lulz.
- recuter 5y ago
  You're probably right. On the other hand he is one of their biggest users and has a lot of celebrity friends. There's too much drama on real twitter about it anyway. They might be stupid enough to ban him too soon, and if they keep on doing that nobody will want to use it. A lot of the top users haven't tweeted in over a year.

quest88 5y ago

He can buy one of those other competitors used by right-wing folks. Hell, if "free speech" is so important to him and to everyone else he wants to rescue he can just tweet to use those other platforms. It's certainly cheaper.

recuter 5y ago
Twitter is "losing hundreds of millions of dollars every year" (I don't know if that's how we're using air quotes now, just following your lead), it is already circling the drain. No need to buy anything, it would be trivial for him to setup a clone and fund it indefinitely while it tears itself apart.
- threeseed 5y ago
  Revenue grew 37% since last year. And they were profitable when you exclude their once off litigation expense. Not sure about your definition of circling the drain but Twitter definitely isn't.
Hamuko 5y ago
Spoiler alert: other platforms are not in any way more "free speech". Gab for example bans porn, which is both free speech protected by the First Amendment, and allowed on Twitter. TRUTH Social seems to forbid a lot of things, such as depictions of violence, lewd content, libelous/slanderous content and lying (true to their name, I guess?).
PKop 5y ago
Twitter is where the network effect and users are, so no it makes more sense to take over Twitter and shape it to your own views if you are a billionaire who wants to make an impact on public discourse and free speech.

Cookingboy 5y ago

>Woke means broke I guess. That sentence alone means you weren't even discussing this in good faith. It's very well possible that the Twitter board believes that they can achieve higher value for the shareholders than what Elon offered. It's also very well possible that after talking to Elon through private conversations that you were not part of, they fundamentally disagree with his value and the direction he wants to take the company. >I think his plan B will be to start a competitor. Hey, maybe he would buy Parler, that would sure get him all the attention he desperately craves for. /s but maybe not.

recuter 5y ago
> That sentence alone means you weren't even discussing this in good faith. Is that what good faith means now? Being religiously part of Camp A or B? The balance sheet speaks for itself. Incidentally Parler or his potential Twitter clone will also end up a toxic internet community. Who cares? I personally wouldn't use either one. Certainly with Twitter already doing a great job losing money and alienating most people (almost nobody actually tweets and usage is falling) an alternative would split the user base and accelerate their demise and the inane concept of web micro-forums being worth tens of billions of dollars. Companies will simply decide advertising on Parler/Twitter is not worth the hassle.
- Cookingboy 5y ago
  >Is that what good faith means now? Being religiously part of Camp A or B? No. But you immediately made this into a Camp A vs. Camp B problem when in reality there could be a million different reasons for the Twitter board to not want to get acquired means you weren't trying to discuss this specific situation, you were looking to turn this into a debate on "wokeness". That's why I said you weren't discussing in good faith. >The balance sheet speaks for itself. Does it? Elon has seen the same balance sheet and he thinks the true value of the company is higher than what it is now as well. So obviously he thinks Twitter has the potential to achieve much higher value through implementing XYZ. The board agrees too but just disagree on what that XYZ is.
  - 5y ago

pcmoney 5y ago

Poison Pills are rarely exercised, this is a positional move. Unlikely Elon is the only interested party at this point. If the board can use a pill to force a slower buy-out discussion and negotiation it is very much beneficial to shareholders. Their stock price was over $70 in the trailing 12 months. Even with Elon's offer they are still worth 10 NFL teams combined. I can find zero credible evidence to support your position. Please short the stock :)

recuter 5y ago
I wasn't aware NFL teams was a unit of measurement. One has to wonder if you think I am wrong why you wish for me to short the stock and lose my shirt.
- deleted 5y ago
  [deleted]
- deleted 5y ago
  [deleted]

threeseed 5y ago

a) The poison pill only affects those who are looking to control the company in some way. Which isn't most large investors at all. So I doubt you will find any who will be concerned by this. b) Twitter's stock price is now $45, peaked at $77 only last year and is profitable. Not sure where you get this ridiculous idea the company is unsellable. c) There are plenty of free speech competitors to Twitter. None are even remotely successful. Because as Reddit also showed far more people want a moderated experience more than those that don't. And Twitter is a business first and foremost. d) Musk is offering shareholders a premium as the stock is today. But as I mentioned even just last year it was significantly higher. And so I can't imagine shareholders would have an issue about them turning it down if they believed Twitter was still continuing to head in the right direction as it is now.

SilasX 5y ago
>The poison pill only affects those who are looking to control the company in some way. Which isn't most large investors at all. So I doubt you will find any who will be concerned by this. That's not the right way to think about it. Anything that scares off ambitious, optimistic activists from buying big stakes, will then suppress the stock value in general, which hurts all shareholders, including the smaller ones. More broadly, going public is a tradeoff. You potentially give up control to outsiders, in return for greater share value (and the cash infusion). Moves like this go the opposite direction: decrease the potential for outside control, and with it, the upward pressure on the stock's value.

version_five 5y ago

> I think his plan B will be to start a competitor I hope it isnt: I think that starting a top down, meaning "look I built this, everyone move over from twitter", competitor has a very low probability of success, regardless of who starts it. There is too much of an attack surface, there will be too much drama on real Twitter about it, early adopters will be gun nuts or some other out group and that will be how they get characterized, etc etc. The real chance at a competitor would be something that grew organically, that people wanted to move to because it offered something valuable before it reaches scale. This is how actual businesses start. The top down approach is how massive flops happen. Incidentally, the same holds true for the Facebook metaverse and imo suggests it will certainly fail

ratboy666 5y ago
Remember that this IS Musk; not very predictable. But I'm going to try... Since Musk has stated that this was NOT to make money, I imagine that triggering the poison pill, and THEN dumping the shares would tank the stock. Musk did say "final offer, and if rejected, re-evaluate". The poison pill trigger? Not something talked about. I hold some shares of TWTR, and would continue. For the lulz.
recuter 5y ago
You're probably right. On the other hand he is one of their biggest users and has a lot of celebrity friends. There's too much drama on real twitter about it anyway. They might be stupid enough to ban him too soon, and if they keep on doing that nobody will want to use it. A lot of the top users haven't tweeted in over a year.