Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Ask HN: What happened to Twitter poison pill?

news.ycombinator.com

Post reply on HN
Print view View original

191–200 of 303 posts

Re: Ask HN: What happened to Twitter poison pill?

#191

Post by WalterBright »

krick wrote: post #131
mabbo wrote: post #63

During a hostile takeover, someone buys 51% of the shares. They then elect a board of people who will approve whatever they want. Then they can do things like 'merge' the company with some other company they own at a board-approved value-per-share. That value will be much lower than what they paid per share when buying it on the open market, but not so low that the government gets involved. Eg: Musk buys the shares a…

1. How does that look for a random TWTR holder far away from SV? One day his broker just informs him that there are no longer securities on his account, but that account has received some cash? 2. Why is it even allowed (by the government) to decide the share price at the board meeting? These shares don't belong to them, somebody has purchased them already. And these people have decided what the shares are worth, tha…

I had some stock long term in Tiffany. Last year, Tiffany was bought by some outfit, and I received cash for the stock. I found out about it by looking at the statement and wondering where that cash came from :-/

I have some TWTR, and I expect the same thing will happen.

Re: Ask HN: What happened to Twitter poison pill?

#192

Post by ttybird2 »

krick wrote: post #175
MacsHeadroom wrote: post #171

Earlier quoted context omitted.

>If anybody makes them sell at any price that's less than what they want — it's a robbery. No, this incorrect. Pending a shareholder vote, the board of a company can force you to accept an amount they determine to revoke the validity of your shares. If the value per share (which they decide) of a specific class of shares is not so low as to illicit concern from regulators then it's all above board.

It seems you don't understand the question. I understand that the board can decide value per share. Basically everyone in this thread said this at least once, which is unnecessary, since that's basically what was stated in the root post, and that's why I asked the question in the first place! The question is how this is supposed to be fair. Because, once again, if you make me to sell my property for anything less tha…

It is not fair nor it is supposed to be. Stocks make as much sense as NFTs.

Re: Ask HN: What happened to Twitter poison pill?

#193

Post by 542458 »

tptacek wrote: post #190
mylons wrote: post #134

Earlier quoted context omitted.

1: yes. you get cash for your shares. 2: the board is representative of the share holders, like your US Congress person. they have a fiduciary responsibility to give the share holders value. the only reasonable way they could blow up this deal is if twitter had an incredible roadmap with a very good path to matching the value or exceeding the value of Elon's offer. no such roadmap exists, apparently.

The board could very easily have blown up the deal, which is proceeding only because they've consented to it. The game plan is simple: they do nothing, Musk executes a tender offer (which has a good chance of failing, so there's an out), the board says "nice job, but we're holding out for more money, check in with us next year", Musk launches a proxy fight, but it goes nowhere because Twitter has a staggered board an…

There’s an alternative explanation to why the board did what they did: Musk has played fast and loose with “I have the funding for this deal” and “I am correctly disclosing my share purchases” in the past. The poison pill was a way to get him to slow down and talk to the board and get his lawyers to sit down with their lawyers and make sure this wasn’t going to be another “I’m taking Tesla private” moment.

(not saying you’re wrong, both or neither of these may be true)

Re: Ask HN: What happened to Twitter poison pill?

#194

Post by dang »

twayt wrote: post #172
quickthrower2 wrote: post #163

Earlier quoted context omitted.

I see "Sorry but this is utter nonsense" as ad hominem, a put down, with overtones of a dismissive "wiser" person dismissing out of hand what is said. That effect of this psychological slight outweighs the fact that they did back up their argument afterwards and didn't leave it as just an unsubstantial comment. Kind of like a microagression: https://en.wikipedia.org/wiki/Microaggression , I think... Human language an…

No calling an argument "utter nonsense" doesn't imply anything about the person making the argument. You may think it is ad hominem but technically it simply isn't since it isn't directed to a person but rather their argument. However, in this context, calling their argument "utter nonsense" is utterly unnecessary and only serves to up the ante.

It isn't just about being personal (though that's particularly bad). It's about not tossing in pejoratives and putdowns. The HN guidelines are clear about this:

"When disagreeing, please reply to the argument instead of calling names. 'That is idiotic; 1 + 1 is 2, not 3' can be shortened to '1 + 1 is 2, not 3."

We don't want name-calling (in this sense) because it leads to dumber, nastier internet discussion.

It's also particularly easy to avoid. If you take out its first sentence, the GP comment loses nothing but hostility and becomes a far better HN contribution.

https://news.ycombinator.com/newsguidelines.html

Re: Ask HN: What happened to Twitter poison pill?

#195

Post by dogecoinbase »

potsandpans wrote: post #132
dogecoinbase wrote: post #127

Earlier quoted context omitted.

I know it's a big ask, but it would be kind of nice if HN added a flag context situation so one could flag a comment as "has literally no idea about how corporations work" rather than just a generic flag.

as someone with limited understanding of how corporations work, i had a hard time understanding who was factually correct in the exchange.

So, as a rough, the board determines what happens, and the shareholders can notionally replace the board. The board _can_ listen to the shareholders, but are by no means obligated to and in the case of Twitter in particular, the board elections happen on a staggered rotating basis so even a majority shareholder could not immediately replace enough of the board to obtain a majority.

Re: Ask HN: What happened to Twitter poison pill?

#196

Post by tptacek »

542458 wrote: post #193
tptacek wrote: post #190

Earlier quoted context omitted.

The board could very easily have blown up the deal, which is proceeding only because they've consented to it. The game plan is simple: they do nothing, Musk executes a tender offer (which has a good chance of failing, so there's an out), the board says "nice job, but we're holding out for more money, check in with us next year", Musk launches a proxy fight, but it goes nowhere because Twitter has a staggered board an…

There’s an alternative explanation to why the board did what they did: Musk has played fast and loose with “I have the funding for this deal” and “I am correctly disclosing my share purchases” in the past. The poison pill was a way to get him to slow down and talk to the board and get his lawyers to sit down with their lawyers and make sure this wasn’t going to be another “I’m taking Tesla private” moment. (not sayin…

Sure, I'm not unbiased here and am framing this in the way least favorable to Musk --- that if a board is going to accept a first (=chuckle= no, "final") offer from a bidder, it's because the price is more than the board thinks the company is worth. But it's also true that they may have done that calculation quickly, and that really they were just making sure this wasn't an elaborate joke.

Part of my analysis is based on the rumor that Twitter completed a valuation over the weekend, and it wasn't super favorable. But I've got no reliable reporting that establishes that.

Either way, my real point is just that the board could easily have stopped this deal if they wanted to; in fact, they didn't even have to do anything to do stop it.

Re: Ask HN: What happened to Twitter poison pill?

#197

Post by aquark »

krick wrote: post #131
mabbo wrote: post #63

During a hostile takeover, someone buys 51% of the shares. They then elect a board of people who will approve whatever they want. Then they can do things like 'merge' the company with some other company they own at a board-approved value-per-share. That value will be much lower than what they paid per share when buying it on the open market, but not so low that the government gets involved. Eg: Musk buys the shares a…

1. How does that look for a random TWTR holder far away from SV? One day his broker just informs him that there are no longer securities on his account, but that account has received some cash? 2. Why is it even allowed (by the government) to decide the share price at the board meeting? These shares don't belong to them, somebody has purchased them already. And these people have decided what the shares are worth, tha…

1/ Yes, and you also potentially incur taxable capitals gains at a time not of your choosing, which can suck.

Re: Ask HN: What happened to Twitter poison pill?

#198

Post by lvnfg »

krick wrote: post #175
MacsHeadroom wrote: post #171

Earlier quoted context omitted.

>If anybody makes them sell at any price that's less than what they want — it's a robbery. No, this incorrect. Pending a shareholder vote, the board of a company can force you to accept an amount they determine to revoke the validity of your shares. If the value per share (which they decide) of a specific class of shares is not so low as to illicit concern from regulators then it's all above board.

It seems you don't understand the question. I understand that the board can decide value per share. Basically everyone in this thread said this at least once, which is unnecessary, since that's basically what was stated in the root post, and that's why I asked the question in the first place! The question is how this is supposed to be fair. Because, once again, if you make me to sell my property for anything less tha…

The board cannot, by itself, decide the value per share. The board can present its opinion that the deal is fair by approving it, and suggest that all shareholders take this course of action by subjecting the deal for shareholder vote. If the majority of shareholders agree by voting in favor, then the company will be sold, even if a significant minority disagrees, because the company is structured to act according to the will of the majority. That's what makes this a "fair deal".

Re: Ask HN: What happened to Twitter poison pill?

#199

Post by dang »

fennecfoxen wrote: post #145
dang wrote: post #142

Earlier quoted context omitted.

> Sorry but this is utter nonsense. Can you please make your substantive points without name-calling? There's a site guideline that asks you to do just that. " When disagreeing, please reply to the argument instead of calling names. 'That is idiotic; 1 + 1 is 2, not 3' can be shortened to '1 + 1 is 2, not 3. " https://news.ycombinator.com/newsguidelines.html

If that guideline is meant to cover the words “utter nonsense” it is not intuitive to anyone

I don't see much daylight between "utter nonsense" and "that is idiotic".

Re: Ask HN: What happened to Twitter poison pill?

#200

Post by friesfreeze »

krick wrote: post #186
friesfreeze wrote: post #183

Earlier quoted context omitted.

Also - since I'm on a bit of a roll - there are definitely other stories for what is going on here. One is that poison pills kind of soften the edges of capitalism a bit by allowing directors to decide if they want to the company to be sold or not. Call it crocodile tears by entrenched management, but there is something to be said for keeping a company off the market if the hostile bidder is going to just fire worker…

Thanks, that's a bit more of an explanation to what I was wondering about than most of the other answers.

You're welcome. Corporate governance is a surprisingly controversial area for how boring it seems at first glance.

Here's a more in depth apologetic for the interested: https://theliptonarchive.org/1980s/

Post reply on HN