Experts warn that Elon Musk’s denial of a Twitter board membership allows him to increase his ownership stake and avoid commitments to promote the company’s interests.
That Musk had become Twitter’s largest shareholder last week triggered an emotional roller-coaster ride that concluded with Musk walking away, according to the platform’s CEO.
It was unclear what would happen next, but closely-followed the billionaire’s plans for Twitter.
According to Wedbush analyst Dan Ives, it’s now “likely a ‘Game of Thrones’ confrontation between Musk and Twitter.” “Musk has joined the Twitter board of directors and kept his stake below 14.9 percent, allowing Twitter to move forward strategically.”
Musk agreed to limit his stake in Tesla below 15% as part of his board appointment pact with Tesla. Instead of having to be nice to Twitter board members, he can now accumulate stock and advocate for change. Analyst Carolina Milanesi of Creative Strategies believes Musk wants more control of the company than the board will allow him.
Musk acknowledged his departure from the board in an amended filing to US securities regulators on Monday, without giving any explanation. His rights included selling or buying more Twitter stock and engaging the board or management “without limitation” on subjects ranging from structure and governance to management and strategy, according to the filing.
According to Ives, Musk might now try to impose his will on Twitter or perhaps sell the firm. According to Ives, Musk may also abandon the game and focus on other projects like electric automobiles, space travel, and even brain-computer interfaces.
Judge or victor?
In recent weeks, Musk, a tech superstar with over 81 million Twitter followers, has disclosed a 9.2% stake in Twitter. Twitter CEO Parag Agrawal described him as “a passionate believer and a forceful critic of the service, which is precisely what we need.” “I look forward to working with Parag & Twitter board to make big changes to Twitter in the next months!” Musk wrote on Twitter.
An Agrawal statement stated Musk’s appointment was conditional on a background check and acting in the company’s best interests.
On Twitter, Musk made a series of snide remarks over the weekend.
One suggestion was to transform Twitter’s San Francisco office into a homeless shelter because no one uses it, and another was to give paying Twitter Blue subscribers blue authentication checkmarks.
Tesla CEO Elon Musk changed his mind about the board after asking whether Twitter was “dying” and naming people like singer Justin Bieber, who are heavily followed but rarely post. The corporation should delete the “w” from its name, he joked in a tweet.
Having millions of Twitter followers doesn’t guarantee the serial entrepreneur knows the best ways to monetize the unique one-to-many communications medium.
So perhaps Musk sees this as an investment in Twitter’s future subscription revenue and advertising revenue growth.
“Or maybe he’s just doing it for the ‘lolz,'” he continued, alluding to internet terminology for making fun of others.