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Elon Musk drops plans to join Twitter board, deletes weekend tweets

by Staff GBAF Publications Ltd
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By Abinaya V and Nivedita Balu

(Reuters) -Elon Musk rejected Twitter Inc’s offer to join its board, an abrupt turn even as he suggested ideas in a barrage of tweets ranging from removing advertisements to dropping the letter “w” in the social media company’s name.

The board held many discussions with Musk, Twitter Chief Executive Officer Parag Agrawal said in a note posted to the site on Sunday, while warning of “distractions ahead.” He did not, however, disclose the reason for the Tesla chief’s rejection.

The latest surprise stoked chatter on everything ranging from the possibility of a buyout to his moves to avoid further attention from the U.S. Securities and Exchange Commission.

Musk was expected to join the board on April 9 following his disclosure of a 9.1% ownership of Twitter shares, but the role would have capped his stake at 14.9%.

Sources told Reuters that Musk had asked Twitter for a board seat even before the company’s invitation.

With the rejection, Musk, who is now the company’s biggest shareholder, is free to raise his stake above that limit.

“I believe this is for the best,” Agrawal said in the note. “There will be distractions ahead, but our goals and priorities remain unchanged.” (https://bit.ly/3usFqhe)

Musk, whose net worth is pegged at $274 billion by Forbes, responded only with a face-with-hand-over-mouth emoticon on Twitter.

Musk seems to have deleted the tweet and a number of others over the weekend, including his musings on removing ads and an authentication checkmark for Twitter subscribers who pay $3 a month.

Musk, who calls himself a free-speech absolutist and has been critical of Twitter, disclosed the stake on April 4 and said he planned to bring about significant improvements at the social media platform.

The news has stoked widespread speculation on his intentions, ranging from a full takeover of the platform to taking an active role in corporate decisions.

Musk’s latest decision opens the possibility for him to take a larger position and potentially make an all-out bid, CFRA Research analyst Angelo Zino wrote in a client note.

“We had thought the equity cap and board seat was originally intended to handcuff Musk in many respects and think he is unlikely the type of individual who will now just sell his stake and walk away,” Zino added.

News of Musk taking a board seat had some Twitter employees panicking over the future of the social media company’s ability to moderate content, company sources told Reuters.

Before taking a stake, Musk ran a Twitter poll asking users if they believed Twitter sticks to the principle of free speech.

A day after becoming the largest shareholder, he launched another poll asking users if they wanted an edit button, a long-awaited feature on which Twitter has been working.

The Tesla boss also asked users in a poll if Twitter’s headquarters should be converted into a homeless shelter, a plan backed by Amazon.com Inc’s founder Jeff Bezos.

On Saturday, Musk suggested changes to the Twitter Blue premium subscription service, including slashing its price, banning ads and providing a payment option in the cryptocurrency dogecoin.

“I think what he realized is that by being on the board his voice will diminish and that’s absolutely the last thing he wants,” Wells Fargo analyst Brian Fitzgerald said.

(Reporting by Abinaya Vijayaraghavan, Nivedita Balu and Juby Babu in Bengaluru; Editing by Arun Koyyur, Miyoung Kim, Edmund Klamann and Anil D’Silva)