Twitter has adopted a plan against hostile actions, a defensive strategy following Elon Musk’s $ 43 billion takeover bid. This is the so-called ‘poison pill’, or the options reserved for existing shareholders to buy a certain amount of shares at a favorable price to prevent hostile takeover.
The plan, the group explains in a note, must “reduce the possibility of any entity, person or group taking control of Twitter by accumulating shares in the market without paying all shareholders an appropriate premium or by giving the board sufficient time to take informed decisions “.
According to the plan, also known as “poison pills” strategy for resist an offer from a potential buyer, the rights will become enforceable if someone acquires ownership of 15% or more of Twitter’s outstanding common stock in a transaction not approved by the Board. The rights plan will expire on April 14, 2023, Twitter said.