Twitter board adopts poison pill after Musk’s $43B bid to buy company • Hacker News Board

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#721

Post by tptacek » Sat, Apr 16, 2022, 5:45 AM UTC

memish wrote: post #696

Some points from the All in Pod. 1. The Twitter board of directors has become a status thing. It's like a country club. They don't have real skin in the game; they don't own much stock. They're not aligned with the shareholders. It's about status and cultural power. 2. Why should we believe that the company will become more valuable when the stock price is where it was way back in December 2013? Compare to how the S&…

"One AI engineer from Tesla could solve Twitter's bot and spam problem."

It's hard to take any of the rest of this seriously after that "detail".

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#722

Post by thereare5lights » Sat, Apr 16, 2022, 5:47 AM UTC

memish wrote: post #696

Some points from the All in Pod. 1. The Twitter board of directors has become a status thing. It's like a country club. They don't have real skin in the game; they don't own much stock. They're not aligned with the shareholders. It's about status and cultural power. 2. Why should we believe that the company will become more valuable when the stock price is where it was way back in December 2013? Compare to how the S&…

> 4. One AI engineer from Tesla could solve Twitter's bot and spam problem.

I don't know why people think is the problem.

They regularly ban bot and spam accounts. This is not an issue.

The issue is malicious/ignorant human actors and malicious state level actors.

Tesla AI engineers can't even get past L3. There's no chance they would be able to create an AI solution that can fight state level resources or massive amounts of humans gossiping and spread misinformation.

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#723

Post by furyofantares » Sat, Apr 16, 2022, 5:50 AM UTC

4khilles wrote: post #613

rgbrenner wrote: post #335

Earlier quoted context omitted.

It’s definitely just a stunt… he doesn’t have the money, and said he expects larger shareholders to sign on to the deal… so he can take the company private and do great profit-maximizing ideas like turning their office into a homeless shelter. He’s presented no ideas that would increase twitters profits or market share. What shareholder would sign up for this?

Why would Twitter profits matter to shareholders after they divest?

They wouldn't be divested. He's said he intends to allow the maximum number of shareholders legally allowed to continue as shareholders, that is, the biggest investors get to not divest if they want.

GP is implying that since Musk is relying on this in order to finance it since he doesn't have 43B in cash.

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#724

Post by HWR_14 » Sat, Apr 16, 2022, 5:53 AM UTC

nickysielicki wrote: post #29

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? Vanguard, for example, has just had its range of further investment lim…

> Vanguard, for example, has just had its range of further investment limited arbitrarily.

As I understand vanguards structure, they have no beneficial ownership of any company and therefore never trigger the poison pill.

> Who does this benefit besides the board?

This benefits anyone who is concerned that a rich person will buy 50%+1 of a company and use their equity to make decisions they are opposed to. Now if a rich person accumulate 20%, the other shareholders can dilute that rich person. That means the rich person has to convince other shareholders that decision is correct.

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#725

Post by __turbobrew__ » Sat, Apr 16, 2022, 5:53 AM UTC

rgbrenner wrote: post #350

codedokode wrote: post #333

I don't really understand how this "poison pill" is legal. Imagine that you own a stock that can be sold at free market at $10/share. Then the board decides that whoever buys those shares will have to resell them to board members at $1. This means that now the price of those shares drops to $1 and you have lost $9 per share. How this can be legal?

That’s not the way it works. So of course it sounds illegal because you’ve made up an illegal scenario. When the board triggers this clause, they may sell shares to existing shareholders at a discount. These are new shares. Companies have every right to sell shares outside of the exchange they’re listed on… and they do that all the time, through employee grants or options, for example. When raising funds they general…

Why doesn’t the board just issues shares to existing holders whenever Elon goes over 15%? You effectively dilute Elon out of getting over the 15%? It seems like the only difference with the poison pill is that you have to pay a discounted rate instead of getting new shares for free. But if the company can issues discounted shares to prevent a takeover why don’t they just issue free shares to prevent a takeover?

For example, if Elon goes to 16% ownership why doesn’t the board just distribute new shares to existing owners pro-rata to the point where Elon is back to 15%?

All of this seems pretty sketchy to me. I don’t see how the board is legally allowed to do this.

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#726

Post by vasco » Sat, Apr 16, 2022, 5:55 AM UTC

s1artibartfast wrote: post #225

not2b wrote: post #184

Even before the poison pill was adopted, the evidence is the market wasn't taking Musk's offer seriously. That's because he was offering $54.20 per share (ha ha, 420), but the stock price never closed higher than $48.36. So almost $6/share was left on the table. Part of it is that Musk doesn't have $43B in cash, he'd have to raise it or borrow it. He's worth more than that but it isn't liquid; as an officer of Tesla…

>So almost $6/share was left on the table. This is only true if the there is no uncertainty. If you think the value without the takeover is $30, and it is trading at 48, and buyout is $54, that means the market thinks it 75% likely. downside -$18, upside +$6 = 75% likely

It means the market doesn't think it's likely but it doesn't mean it's 75%. To illustrate why that makes no sense, if Musk had offered $35 instead of $54, the buyout would be much less likely, since the price would be way lower and the board and shareholders less likely to accept it, yet under your model the likelihood would go up.

Estimating probability from price action is something you can do, but not like you did it.

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#727

Post by celdon25 » Sat, Apr 16, 2022, 5:56 AM UTC

systemvoltage wrote: post #281

UnpossibleJim wrote: post #105

So, I'm not very corporate savvy and this might be a very stupid question. Is there a NON-culture/political reason for all the push back against Musk buying Twitter? From the read, this just seem to be opening the door for someone else to try and take majority control and pining away for the days of Dorsey (which, if looked at objectively, weren't great... just filling an opportunity).

The sad truth is that this is an intense political battle. I would personally favor Elon Musk taking over and shaking things up, any other position is untenable. And, I am saying this as a progressive. I think an open and transparent social platform would be great for the society. The issue is that managerial class of America, both in private and public sector, are in bed with each other. The government cannot suppre…

> Now, my own party wants to turn America into an authoritarian censorship dystopia

You could start by lobbying to force tech companies over a certain size to disclose reasons for users or content being removed from the platform. The legislation would have to have teeth, naturally.

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#728

Post by emodendroket » Sat, Apr 16, 2022, 5:58 AM UTC

memish wrote: post #696

Some points from the All in Pod. 1. The Twitter board of directors has become a status thing. It's like a country club. They don't have real skin in the game; they don't own much stock. They're not aligned with the shareholders. It's about status and cultural power. 2. Why should we believe that the company will become more valuable when the stock price is where it was way back in December 2013? Compare to how the S&…

> The elites have somehow inverted history so they now believe that it is not censorship that is the favored tool of fascists and authoritarians, even though every fascist and despot in history used censorship to maintain power, but instead believe free speech, free discourse, and free thought are the instruments of repression.

It feels a little silly to act like the guy trying to spend billions of dollars to get his way represents anything more than an intra-elite conflict.

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#729

Post by memish » Sat, Apr 16, 2022, 5:58 AM UTC

tptacek wrote: post #721

memish wrote: post #696

Some points from the All in Pod. 1. The Twitter board of directors has become a status thing. It's like a country club. They don't have real skin in the game; they don't own much stock. They're not aligned with the shareholders. It's about status and cultural power. 2. Why should we believe that the company will become more valuable when the stock price is where it was way back in December 2013? Compare to how the S&…

"One AI engineer from Tesla could solve Twitter's bot and spam problem." It's hard to take any of the rest of this seriously after that "detail".

Why? You don't have to agree with everything. That's fine. It's a separate point from the others.

Re: Twitter board adopts poison pill after Musk’s $43B bid to buy company

#730

Post by sillysaurusx » Sat, Apr 16, 2022, 6:00 AM UTC

tptacek wrote: post #721

memish wrote: post #696

Some points from the All in Pod. 1. The Twitter board of directors has become a status thing. It's like a country club. They don't have real skin in the game; they don't own much stock. They're not aligned with the shareholders. It's about status and cultural power. 2. Why should we believe that the company will become more valuable when the stock price is where it was way back in December 2013? Compare to how the S&…

"One AI engineer from Tesla could solve Twitter's bot and spam problem." It's hard to take any of the rest of this seriously after that "detail".

I think this is the first time I disagree with you. Bot problem, perhaps not. Spam problem, definitely.

https://twitter.com/paulg/status/1487022342630957062?s=21&t=...

https://twitter.com/paulg/status/1496549841912094733?s=21&t=...

https://twitter.com/paulg/status/1485588476057825290?s=21&t=...

and

https://twitter.com/id_aa_carmack/status/1473752736537657349...

https://twitter.com/id_aa_carmack/status/1399028630190239746...

I know how hard it is to deploy features at scale, especially at a world-class company like Twitter. But if Twitter were to retain me as a consultant, I’d happily bet you any sum of your choosing that I’d make a pretty big dent in the crypto spam within a few months of full-time effort.