Tesla and SpaceX CEO Elon Musk spent almost $3 billion to become the largest shareholder of social media giant Twitter. So now, show him what he’s won.
First of all, his purchase of 73,486,938 Twitter shares is only a 9.2% stake. He does not have a controlling interest and alone cannot force major change at the company. For that, he’ll need to get 10 or more of the other top shareholders to agree on changes to the board of directors so that they can then make leadership changes at the officer level in the company so they can then make management changes to effect a culture change in an institution where suppression of disliked speech is engraved in the walls. It will not happen fast or perhaps at all.
Musk made the purchase on March 14, 2022, which was before he started criticizing Twitter’s oppressive behavior. Posting on the platform, Musk questioned on March 26th if Twitter “adhered” to free speech principles and whether a new platform was needed – seemingly a hint at him considering a new social media startup. That was almost two weeks after he threw a few billion dollars at Twitter.
So, with his 9.2% stake, he’s not really in a position to root out the entrenched leadership… yet.
Has Musk already begun conversations with Vanguard, Morgan Stanley, Blackrock, et al? Or is Elon ready to dump an even more substantial portion of his nest egg to buy up some of the more than 700 million shares available? Who knows?
The idea of Musk buying Twitter (owning at least a 50.1% stake) was bandied about on Twitter over the weekend. While fixing Twitter seems easier than starting yet another alternative, the entrenched leftist bias runs very deep at bluebird central. The wholesale cleansing that is needed would create a massive brain drain at every level of the company as directors, managers, developers, and more quit in droves to protest. Any drastic shift in culture will cause an upheaval that could tank the company. And, maybe Elon has decided that losing a few billion dollars is worth doing just that.
Is Mr. Musk just investing in Twitter to grow his portfolio or has he decided to become an activist investor with dreams of changing the social media landscape? It’s hard to say, but grab some popcorn – it should be interesting to watch.
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