{"id":1446116,"date":"2022-04-19T13:29:35","date_gmt":"2022-04-19T17:29:35","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1446116"},"modified":"2022-04-19T13:29:45","modified_gmt":"2022-04-19T17:29:45","slug":"florida-considers-activity-against-twitter-for-rejecting-musk-present-citing-boards-breach-of-fiduciary-duty","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/florida-considers-activity-against-twitter-for-rejecting-musk-present-citing-boards-breach-of-fiduciary-duty\/","title":{"rendered":"Florida Considers Activity Against Twitter for Rejecting Musk Present, Citing Board\u2019s Breach of Fiduciary Duty"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"float:left\"><div class=\"counts mashsbcount\">30<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fflorida-considers-activity-against-twitter-for-rejecting-musk-present-citing-boards-breach-of-fiduciary-duty%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1446116&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><div><\/div>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\"><strong>THE VILLAGES, Fla.<\/strong> \u2013 After Twitter dropped a major roadblock in front of Elon Musk\u2019s effort to take over the company, Gov. Ron DeSantis announced Tuesday that Florida &#8212; an investor in Twitter through the state\u2019s pension fund &#8212; is looking into what action it can take against the board of directors.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">DeSantis said the social media company\u2019s choice to adopt a <a href=\"https:\/\/apnews.com\/article\/business-media-elon-musk-carl-icahn-95ab7b9e8ca81274d387bea1d6a088c3\">\u201cpoison pill\u201d defense<\/a> that makes it difficult for Musk or any other investor to buy Twitter without the board of directors\u2019 approval amounted to a political decision and not a smart business move.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">Musk\u2019s offer of $43 billion &#8212; or $54.20 per share &#8212; was about 20% higher than the $45.08 closing price the day he made the offer. Shares of Twitter closed Monday up 7.5% at $48.45, still $5.75 shy of Musk\u2019s offer. That\u2019s a sign that investors are skeptical of whether Musk can pull off the deal.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">DeSantis questioned the business decision to reject an offer 20% over the current stock value, but Al Waleed bin Talal, a Saudi prince who is among Twitter\u2019s major shareholders, scoffed at the offer, saying said he didn\u2019t believe $43 billion is close to Twitter\u2019s value given its growth prospects. Twitter shares hit an all-time high of $77.63 in March 2021.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">During a news confernece Tuesday in The Villages, DeSantis said, for now, lawyers are reviewing what the state might be able to do to hold the Twitter board of directors \u201caccountable for breaching their fiduciary duty.\u201d<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">\u201cI don\u2019t want to expend resources just to kind of be able to send out a press release or something. I mean, we really want to feel like we have a solid theory to be able to win,\u201d DeSantis said. \u201cBut I can tell you just looking at it, most of the time the people I talk to would say if you\u2019re on the board in that situation, you really do need to sell. It\u2019s a massive return for your shareholders. I mean, most people and their investment vehicles are not making 20% in a year.\u201d<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">DeSantis argued that the motivation was political rather than financial.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">\u201cThey rejected it because they know they can\u2019t control Elon Musk,\u201d DeSantis said. \u201cThey know that he will not accept the narrative and that their little play toy of Twitter, it would not be used to enforce orthodoxy, and to basically prop up the regime and these failed legacy media outlets. And so that\u2019s why they did it. It was not, in my judgment, because it wasn\u2019t a good business deal.\u201d<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">This wouldn\u2019t be the first time Florida has taken on big tech. The state passed <a href=\"https:\/\/www.news4jax.com\/news\/local\/2021\/06\/07\/floridas-big-tech-censorship-bill-could-be-blocked-before-it-goes-into-effect\/\" target=\"_blank\" rel=\"noopener\">a big tech accountability and transparency bill <\/a>last year that the tech companies sued over, and that issue is currently moving through the courts.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">\u201cThey advertise as being open platforms. They advertise as you being able to express yourself and communicate with other people, and yet, their censorship decisions and deplatforming decisions are based on viewpoint discrimination,\u201d DeSantis argued.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">With the takeover bid, Twitter\u2019s next likely move is to formally reject Musk\u2019s offer, although it could negotiate. Musk has a number of options which also include talks with the board, sweetening his offer, or even triggering the poison pill, which experts say would be disastrous for the company.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">In a regulatory filing on Monday, Twitter\u2019s board said it approved the defensive move to protect the company from \u201ccoercive or otherwise unfair\u201d takeover tactics.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">The board is leaving open the possibility of negotiating with Musk or another suitor. The filing says the shareholder rights agreement should not interfere with any merger or offer approved by the board.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">When he made his offer public, Musk provided no details on financing, but such a disclosure could improve his chances. He could raise money by borrowing billions using his stakes in Tesla and SpaceX as collateral, and he could bring in other investors.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">The poison pill would give stockholders as of April 25 the right to buy one one-thousandth of a share of preferred stock for each common share they own, at a price of $210. The rights are triggered if any person or group of investors buys 15% or more of the company\u2019s shares without board approval.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">The preferred stock would have the same voting rights as a common share, according to the filing, which does not specifically mention Musk.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">The poison pill essentially would spell the end of Twitter if Musk or another investor acquires 15% or more of the company, said James Cox, a professor of corporate and securities law at Duke University.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">Shareholders who exercise the rights and buy preferred stock at $210 would get $420 in Twitter stock or assets, he said. That would be more than Twitter can afford to pay and likely would send the company into receivership, Cox said.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">\u201cYou want to create an event that Musk would never want to trigger because it would be the death of Twitter,\u201d Cox said. He predicts that Musk and the board will negotiate, at least for a while, adding that no investor has ever crossed the line to activate a poison pill.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">If Musk triggered the poison pill, he risks wiping out much of the money he has invested in Twitter because his stake would be diluted, said Columbia University law professor Eric Talley. \u201cYou want to deter someone from deliberately triggering the poison pill,\u201d Talley said.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">Twitter&#8217;s board has information that the average shareholder doesn&#8217;t, such as earnings or market growth projections, and whether there&#8217;s reason to believe that the share value is artificially depressed, Talley said. The board, he said, could just hold out.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">&#8220;They\u2019re sitting right now on top of a poison pill that\u2019s a bit of a showstopper. From a corporate law perspective, they\u2019re on pretty solid footing right now if they just keep that in place and say they\u2019re not comfortable bargaining at this stage.\u201d<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">Musk said in making his bid that Twitter \u201cneeds to be transformed as a private company\u201d in order to build trust with users and do better at serving what he calls the \u201csocietal imperative\u201d of free speech. He said shareholders, not the board, should decide whether Twitter goes private.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">Musk began accumulating Twitter shares in late January, ending up with a stake of about 9%. Only Vanguard Group controls more shares. A lawsuit filed last week in New York federal court alleged Musk illegally delayed disclosing his stake so he could buy more shares at lower prices.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">Musk took to Twitter to criticize board members in recent days, saying he\u2019d save about $3 million per year by bringing the board salary to zero if his bid succeeds, and noting that board members collectively owning just a tiny financial stake in Twitter shows that their \u201ceconomic interests are simply not aligned with shareholders.\u201d<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">Musk, who has more than 82 million followers, is a prolific tweeter who has criticized other celebrity accounts for not tweeting enough, suggesting that as a sign that Twitter is dying.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">The takeover episode will put pressure on Twitter executives to show that the company is not underperforming, said Olaf Groth, a business professor at the University of California, Berkeley. Even the entire social media business model of making money through advertising &#8212; which Musk has questioned &#8212; is now \u201cup for discussion,\u201d Groth said.<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">\u201cHe may decide it\u2019s not worth it, and that he sent a political signal to exert pressure,\u201d Groth said. \u201cNow all eyes are on Twitter and the clock is ticking.\u201d<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">____<\/p>\n<p class=\"sc-bwzfXH dist__TextBase-sc-1fnzlkn-2 hLMqRF\">O\u2019Brien reported from Providence, Rhode Island.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>THE VILLAGES, Fla. \u2013 After Twitter dropped a major roadblock in front of Elon Musk\u2019s effort to take over the company, Gov. Ron DeSantis announced Tuesday that Florida &#8212; an<\/p>\n","protected":false},"author":498,"featured_media":2315279,"comment_status":"open","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1446116","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1446116","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/498"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1446116"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1446116\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2315279"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1446116"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1446116"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1446116"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}