Twitter Adopts Limited Duration Shareholder Rights Plan | Hacker News Reader

Twitter Adopts Limited Duration Shareholder Rights Plan

prnewswire.com

100 pointsminimaxir222 comments

Twitter reminds me a lot of Yahoo about a decade ago. A company that lost its way. Cycling through lots of CEOs, re-orgs and visions and a culture that atrophied along the way.

Microsoft offered to buy Yahoo for $45B in 2008. The board of directors declined, believing in much more upside. Yahoo became increasingly irrelevant. They later sold to Verizon for $4.5B

https://www.onmsft.com/news/its-finally-over-yahoo-is-acquir...

No. Yahoo played that situation smartly. They knew they were worth more than the $45B Microsoft offered due to their stake in Alibaba.

This thread dives into how Microsoft lowballed Yahoo: https://news.ycombinator.com/item?id=31029289

No.

Yahoo got lucky with the Alibaba stake. That wasn’t what Microsoft was after. Microsoft was desperate to be relevant in Internet consumer services and compete with Google.

Yang and the board believed they could fix Yahoo. None of their predictions came true.

—-

“In an email to Yahoo employees after the board's rejection of the Microsoft offer was made public, Chief Executive Jerry Yang maintained that the company is well-positioned to grow, citing the Internet powerhouse's efforts to improve its standing in online advertising and build an alliance with newspapers.

"We have accomplished a great deal in a very short time," Yang said. "Yahoo is a faster-moving, better-organized, more nimble company well on its way to transforming the experiences of its users, advertisers, publishers and developers."

He said the company aims to "grow visits to key Yahoo starting points and properties by approximately 15% per year over the next several years."

https://www.marketwatch.com/amp/story/yahoo-rejects-bid-micr...

There's a difference between what the board believed (we'll probably never know,) and what they communicated. No one would email their workers saying "we're waiting for payday, at the expense of you".

That is fair.

However I don’t think that applies here. if the board truly believed it, they would have sold the “pure Yahoo” piece to Microsoft for far more than $4.5B and spun out the Alibaba stake. They didn’t and ended up losing billions in shareholder value.

Maybe that wasn't on the table. We won't know until some executive would retire and end up writing a tell all.

You can just read the statements from Ballmer and others on what they were excited about. I wasn’t on the deal team, but I worked with them on parts of it. The statements below are reflective of the belief.

Occam’s razor would suggest that Microsoft and Yahoo’s exec teams both talking about the value of the Yahoo Internet services as the rationale for the deal probably is the truth. And Microsoft would have paid much more than 10% of the $45B to get it.

——

Microsoft sees Yahoo as a way to compete with arch-rival Google Inc GOOG.O in the Internet search and advertising arena, but it has limits to what it is willing to pay to get a deal done.

“We’re prepared to move forward without a merger with Yahoo,” Ballmer said. “We think the best way to move forward quickly (and gain critical mass against Google) is to come together with Yahoo.”

https://www.reuters.com/article/idUSMAT00810920080423

To be fair, I think Microsoft would have also fumbled Yahoo at the time.

This was the era of Vista and IE and windows live/hotmail. My maybe-controversial(?) opinion is they just would have MSNd Yahoo in some directionless brand “synergy” at a time where Microsoft still seemed to be figuring out what its own future identity/company vision would be.

I think Yahoo knew that. And while Yahoo had many of the same challenges internally at the time (which it eventually succumbed too, whereas there was no clear consensus that Microsoft would successfully reinvent itself), at least it was in control of its own destiny

100% agree. I believe Microsoft would have made a mess of the acquisition. Microsoft had the same issues internally with their MSN/Live strategy at the time. Integrating Yahoo + MSN/Live was unlikely to succeed.

That is separate from saying that Yahoo shareholders would have benefited from selling to Microsoft.

No.

... I don't actually have an argument. I just wanted to keep the 'No' chain going. Sorry.

> Yahoo played that situation smartly.

This is one of the hottest tech takes I've read in the past 10 years.

Getting lucky due to an investment in something that is _not_ their core business does not count as "smart" to me.

Twitter still has fantastic network effects, making it difficult to supplant. If only someone, perhaps Musk, can solve the censorship problem for them.

Can you elaborate on what you think the censorship problem is?

Killing good (funny) accounts from various anons and even small celebrities, like Nick Mullen.

It stifles discussion (people are worried about getting locked/limited/banned) and makes for a much less interesting scroll.

So the censorship problem is that the twitter feed became less interesting for you as a user?

That sounds more like just bad product choices (assuming it drives users away) rather than any sort of issue of rights.

Censoring important news stories during an election and then a year later just being like, oops, ya that was real.

This supposed “important news” is an invented (probably Russian) propaganda story that couldn’t be confirmed by any of the news outlets who investigated it and was hyped up by armies of Russian bots and Russian-funded media trolls, immediately before a presidential election. [According to proponents of this story, the chain of custody of this laptop goes: Hunter Biden → Repair Shop (owned by a legally blind GOP partisan hazy about the details) → ??? → Rudy Giuliani → Steve Bannon → NY Post → Matt Gaetz. Seriously?]

A year and a half later, the course of the Russian invasion of Ukraine provides solid evidence that we should be thankful for social media companies’ rare responsible anti-propaganda effort here. Instead of dissolving NATO and dropping Russian sanctions as the previous president repeatedly suggested, the US instead provided significant diplomatic, military, intelligence, and economic support, and now Ukrainians have a good chance of holding their country.

Once again, remember that impeachment #1 was about a ham-handed explicit attempt by the US president to extort president Zelenskyy of Ukraine, denying US military aid unless he would fabricate dirt on the president’s political opponent and (falsely) exonerate Russia. For that effort, the president’s entire party (with only a few notable exceptions) gave him a pat on the back.

That “invented Russian propaganda” was confirmed by the New York Times.

No, what was confirmed was that some of the emails placed onto the laptop were real emails. (Those emails are not in and of themselves any evidence of wrongdoing, FWIW.)

Nobody can demonstrate where or how those emails were obtained, or who put them on the laptop. The repair shop owner has repeatedly claimed that much of the current content of the hard drive was not there when he originally examined it.

The whole thing has been treated in such a slipshod and ridiculous manner by a whole clown car of incompetent partisan activists that it is now impossible to validate anything about whose laptop this was or what it had on it originally.

Meanwhile Jared Kushner was literally just handed $2 billion by the Saudi government to run an “investment fund”, right out in the open. None of the people worried about this laptop/email story have said a peep.

From the New York Times[1]: "People familiar with the investigation said prosecutors had examined emails between Mr. Biden, Mr. Archer and others about Burisma and other foreign business activity. Those emails were obtained by The New York Times from a cache of files that appears to have come from a laptop abandoned by Mr. Biden in a Delaware repair shop. The email and others in the cache were authenticated by people familiar with them and with the investigation."

[1]https://www.nytimes.com/2022/03/16/us/politics/hunter-biden-...

I think you've missed some developments, or perhaps I'm misinterpreting you?

https://nypost.com/2022/03/17/hunter-bidens-infamous-laptop-...

Why link to a conservative tabloid instead of the actual article from NYT?

https://www.nytimes.com/2022/03/16/us/politics/hunter-biden-...

honestly, b/c it was the first thing to show up on DDG, and my intuition was that it was so beyond dispute that prestige wasn't a necessary credibility signal

This has been the modus operandi of MSM and social media for the past few years for all sorts of topics. It's sad to see people still speak in favor of such censorship.

Feel free to disagree, but I believe there is a large segment of the population, especially conservatives, who feel sidelined or silenced by Twitter.

Case in point: Musk recently polled his followers: "Free speech is essential to a functioning democracy. Do you believe Twitter rigorously adheres to this principle?" and 70% of respondents said "No" [1].

Also, many conservatives believe that banning Trump while allowing the representatives of various autocracies globally is hypocritical.

Of course, you can argue that Twitter is a private company and can do whatever they please. You can also argue that Trump and his followers are a danger to society, or Elon and his followers are biased. I'm just communicating a perspective I believe exists broadly.

[1] https://twitter.com/elonmusk/status/1507259709224632344

I mean, the poll is biased in that most people who saw it are followers of Elon Musk already (and the split is probably 60-70% people who like him, the rest being journalists, people curious to see what he has to say, and yes, people who disagree with him).

It’s not an objective measure or poll, much in the same way that Trump (or any politician) blasting out “opinion polls” to their donors is not representative of the general US population, so much as the contingent that voted/donated to them.

He has 82 million followers. That’s a lot of people to be completely biased. Granted, it’s not half a billion for completely unbiased sample, but still, that’s a lot.

It seems fairly obvious that most people who follow him do that because they like what he has to say. Even if he had 500 million followers it still wouldn't be an unbiased sample.

Followers != people who take the time to engage with his polls/other content

I'm on Twitter most every day; I don't follow Elon Musk (I try not to follow any big twitter accounts, rather than curate interesting smaller accounts); I didn't see the poll until two days after it was already closed; I think it's fair to say that most people who saw the poll were

a) Either followers of Elon

b) People the Twitter Algorithm decided were most likely to interact with it -- I.E. people who would be interested in what Elon has to say

Just because Elon tweeted something doesn't mean all of Twitter saw it.

Bias is a spectrum, and if your pool is non-random, you will always have a much higher bias than otherwise.

Yeah, and so did Donald Trump before he got banned in 2020; his followership wasn't at all representative of all of Twitter (and that's even considering many people who actively disagreed with him probably followed him purely because of his position of power)

If you polled the audience at a regular-season San Francisco Giants home game against the Los Angeles Dodgers as to what team they support, you'd probably get an overwhelming number of responses indicating support for the Giants. That does not mean more people support the Giants than the Dodgers in Los Angeles. They're two different populations, so you can't generalize the outcome from one to the other.

>> Of course, you can argue that Twitter is a private company and can do whatever they please.

This was what people on the left were claiming when Trump got kicked off. Now? Suddenly they think freedom of speech needs moderation and its not safe in the hands of a single company or Musk having "too much control".

I've never seen this question asked in good faith on HN. It's inevitable that the answers and replies to answers descend into infantile spitting matches, with waring parties attempting to take superior moral high ground.

If you've not already read the litany of articles out there covering both the approval and disapproval of Twitter's method of content moderation, and how it applies its methods over the last 5 years, then now is the time to head to your favorite search engine.

> They later sold to Verizon for $4.5B

After spinning out their share of Alibaba into a separate company worth $56 billion. Yahoo shareholders still got a lot more out of it than they would have by accepting the Microsoft buyout.

This seems to be a clear case of management working against shareholders. Twitter stock has gone nowhere since IPO 10 years ago. 10 years of no dividends and no appreciation in value. Elon is offering a decent premium on the current price and its pretty obvious if he walks away it will return to the old price. Who does a poison pill help and protect? Current management who have attached themselves to a company, this doesn't help the people invested in the company or the people with stock ownership. All these comments are outside if it would be good or bad if Elon owned it, that shouldn't be an investors concern.

To be fair, Jack finally stepped down in November and Parag replaced him as CEO. So there is new management that hasn’t really had time to shine or fail yet.

That's assuming it's a real offer. There is a very high chance that even if the board accepted the offer Elon would back out, which would be a mess that would harm the company. It's clear that trolling is a big part of this (I would say the entire purpose). He doesn't even have funding lined up and doesn't have a real plan for how to run the company beyond vague aspirational statements.

> Elon would back out.... He doesn't even have funding lined up

Can one just walk up to SEC and file an offer to buy out a company all-cash without showing some evidence of how they plan to arrange the money? Isn't there an entry barrier? Also, shouldn't there be a clause to penalise backing out? If not then one could toy around with the share prices as you say, no?

That's not how this sort of thing works. Musk can't back out of this without paying a tremendous sum to the current shareholders. This isn't like a private company acquisition where there is an extended due diligence where anything can come up. He has very few options to cancel the purchase if it is accepted.

You are incorrect. He made a non-binding offer contingent on a number of different conditions, such as obtaining financing, and with the ability to withdraw or modify it at any time, for any reason.

Here is the filing: https://www.sec.gov/Archives/edgar/data/1418091/000110465922...

that is standard boilerplate for these contracts, as I understand it.

Why do you think any sane legal team would greenlight crafting a legal agreement to purchase a corporation for tens of billions without protective clauses?

The conditions under which the sale can fail to go through are enumerated in the document, and all of them are pretty much boilerplate. Practically speaking, Musk cannot back out unless there is a REALLY good reason that isn't enumerated in the offer. Here is the boilerplate:

1. Government approvals - self-explanatory.

2. "Confirmatory due diligence - making sure that Twitter isn't cooking the books or breaking the law (in an undisclosed way - if they have already told you they were breaking the law, that would not qualify).

3. The negotiation and execution of definitive agreements - writing the exact contract terms.

4. Completion of anticipated financing - I am assuming that some amount of the purchase is in the form of a leveraged buyout. This is about the due diligence of the lender, which is similarly restricted.

As LVMH discovered recently in their purchase of Tiffany, it would literally take an event bigger than the pandemic to otherwise get out of a purchase of a public company.

> The Proposal is non-binding and, once structured and agreed upon, would be conditioned upon [...]

> There can be no assurance that a definitive agreement with respect to the Proposal will be executed or, if executed, whether the transaction will be consummated... The Reporting Person reserves the right to withdraw the Proposal or modify the terms at any time including with respect to the amount or form of consideration.

I think you're mistaking it for a deal that's much further along than it is, there is no binding agreement where Mr. Musk would have to pay penalties or anything like that for dropping the deal. An agreement reached as a result of this proposal would be, but that seems unlikely right now.

Which makes it clear why this was such a lowball offer. IMO he never entertained the notion that his offer would be accepted. It was all a troll. 54.20 indeed.

I don't see how Elon Musk being at the helm would improve stock price long term. Yes, making Twitter into a libertarian wasteland would lead to a lot of user growth short term -- the Parler people might come back, along with the bot accounts -- but in turn I predict this would lead to plummeting ad revenue and massive disengagement of its existing (very active, dedicated, passionate) user base, as well as a huge amount of noise that just makes its moderation/NLP infrastructure even worse at filtering harmful content. Maybe I'm wrong/missing something though.

Elon Musk is offering to buy and own Twitter personally. There would be no Twitter stock if the transaction went through, unless he decides to issue some new stock, or IPo the company again at some point in the future.

You act like Elon is interested in anything but a pump and dump here. He offered $54.20 per share in an attempt to pump it to its previous high so he could exit. Fortunately, the market knew he was full of shit. He has done this before, most notably with various cryptocurrencies.

To me it's pretty clear that certain members of the elite be are willing to lose money to wield the power a mass communication platform like Twitter gives them.

The current folks that have control of Twitter appear to have politics and an agenda that runs counter to somebody like Musk. Would they rather run Twitter into the ground than allow a rival to take control of it? I am guessing yes.

Twitter/Reddit/Facebook/YouTube and other mass media platforms are the key way the worlds elite deliver their flavor of 'marketing'/spin to the world to influence and change public opinion. These are not areas of free exchanges of ideas and open thought. "Private platform," etc.

It's yellow journalism 2.0 for the most part, but with clever addictive dark patterns tossed in. Anybody that disagrees gets the ban-hammer or is "de-boosted" into oblivion.

How are Twitters current leaders subverting it to push their agenda exactly?

In any case, I think it's more likely they are blocking a hostile takeover in order to dictate more favorable terms. Otherwise Musk could orchestrate snatching up all the shares at current market value right?

> Otherwise Musk could orchestrate snatching up all the shares at current market value right?

Not anymore, given the decision in this article. If he (or anyone else) acquires more than 15% of current shares, all current shareholders will be given an automatic option to buy more shares.

Trying to avoid being overly political, but how about banning a former US president? Trump has not yet (maybe he will one day?) been found guilty of any crime regarding the whole Jan 6 debacle. Yet we saw the accounts of Taliban members (who without a doubt took over a democratically elected government) and other nefarious folks still have their accounts up and active.

Musk's bid was significantly over market value ($54.20) and above Goldman Sach's price target of $30.

From my external viewpoint Twitter has a heavy political bias. As said by the current CEO:

>“Where our role is particularly emphasized is who can be heard,” he went on. “And so increasingly our role is moving towards how we recommend content … how we direct people’s attention.”

Dorsey I felt at times always tried to do the right thing. Not so sure about the current leadership. One has to assume if Musk was able to take over the company Parag Agrawal would be out very quickly.

Twitter is not a neutral platform. It's funny how you never hear a Twitter insider ever defend or explain why the site appears to be so heavily internally manipulated. If the "wrong" thing hits the trending section it quickly drops off.

Was it always just luck that the same 2-3 accounts were always the same top replies to anything Trump posted. Is this organic? Would love to know.

Accounts like "Brooklyn Dad Defiant" was shown to have taken money from one particular political party. I recall seeing that guy almost always as the first reply to Trump's ramblings. How was his account boosted to such an extent? Seems fishy.

Twitter's annoying dark patterns when it comes to viewing the site without logging in is the main reason why I avoid it more so than some political issue.

Wow, my prediction is Musk will walk away, Twitter stock price will tank, and Twitter will be flooded with thousands of shareholder lawsuits (for breaching their fiduciary duty).

That would be a fairly rational thing to do, but based on past behaviour I don’t think musk is one who backs down easily.

It really depends how much he wants it, which only he knows.

Musk has made announcements before and backed off. I suppose the Muskboys will call that 4D chess, but at the end of the day, it has happened.

Doesn't that make this a smart move then? If they rejected his offer, they'd be hit with the same lawsuits. In this case, they have a defense to say they were acting in the best interests of the shareholders if that causes Musk to back off.

If one thing you need to know about Musk is that he does not back off that easily. (He already mentioned in TED interview that he has a "Plan B" if this offer is rejected.)

Like when he was going to take Tesla private?

The best interest of the shareholders at this point is to accept the offer.

Its a 25% premium, quite typical for buyout offers.

It's nowhere near that clear; the offered price is lower than the stock's 52 week average.

Why is it in the best interest of the shareholders for Musk to back off? He is offering almost double the target price of $30 set by the largest shareholder, Goldman. Goldman thinks company is worth $30 but rejected $55. That’s the opposite of shareholder interest. This only protects them from the actual take over, it’s a desperation move.

Target prices are short-ish term; 12 months.

Goldman could hold the position that the company's current performance justifies $30, but that $55 doesn't fairly reflect the longer-term potential in the business.

(It's also different sections of Goldman, with firewalls and different goals between them.)

And that includes Musk himself because he's not on the board.

>Twitter will be flooded with thousands of shareholder lawsuits (for breaching their fiduciary duty)

It's hard to say that Twitter breached their fiduciary duty when both their representing bank (Goldman) and the second largest shareholder (Kingdom Holding Company) both rejected the offer. The lawsuit will likely go nowhere; the sentiment is that the offer is way too low.

You realize that Goldman has a price target of Twitter in the 30’s right. An offer then of $54.20 is nearly double that target.

There’s a firewall between the GS analyst setting the $30/share price target and the GS investment bankers advising Twitter…I suggest you look into how investment banks are regulated and structured.

> their representing bank (Goldman) [...] rejected the offer.

GS deserves some fire under them for this for sure. Not solely for rejecting it, but due to their stated reasoning for "why".

Their reasoning for rejecting the $54/share acquisition offer was "it is too low of a price target". In the meantime, Goldman's own last reported price target for Twitter is at $30/share.

Unless I misunderstand something about how such things work, which is entirely plausible, this isn't a good look for GS at all.

EDIT: as one of the replies pointed out, I was indeed misunderstanding the situation, and there is no actual discrepancy here. The entity saying "$54 is too low" was GS Bank, while "$30 is the target" statement was from GS Investments. They are separate entities and often disagree with each other.

This is the bank vs the investment side. Goldman Sachs Bank is their representing Bank, Goldman Sachs Investments (or whatever it's called today) is the part that writes the public short-term price targets. They aren't connected and often disagree.

It is the responsibility of the Bank to get maximum return on investment for the company. It is the responsibility of the Investments side to get as many customers in the door as possible and to provide them with timely information.

> This is the bank vs the investment side. Goldman Sachs Bank is their representing Bank, Goldman Sachs Investments (or whatever it's called today) is the part that writes the public short-term price targets. They aren't connected and often disagree.

Ah, that actually makes perfect sense, thanks for clarifying.

Goldman themselves has the price target at $30. Musk offered ~$55. Nearly double the price target. As clear cut a breach as it gets, even more so because Goldman rejected it. Any one that thinks Twitter is worth more than $60/share is delusional.

And yet their one year high is something like $71 a share. This is absolutely a lowball offer from any reasonably long-term perspective.

> and the second largest shareholder (Kingdom Holding Company)

Source? There is no such investor, at least not in the top 13: https://pbs.twimg.com/media/FQWWgx_VsAUoFxT?format=jpg&name=...

https://twitter.com/Alwaleed_Talal/status/151461595698675712...

Easier to start a new platform if you kill the old one first. The proverbial plan b, I presume.

Lawyers are definitely going to make out. Musk is already targeted with shareholder lawsuits for failing to disclose his original purchase.

> fiduciary duty

As mentioned here all the time. Fiduciary duty gives the board and company officers a very wide berth. Telling Musk his offer is too low, and enacting shareholder rights is just fine.

Elon apparently lined up his offer with a talk at TED:

https://blog.ted.com/elon-musk-talks-twitter-tesla-and-the-f...

Interesting war-of-words going on among the twittizens, many people fearful over a platform where their ideological enemies aren't banned, many free-speech-maximalists getting the champagne bottles ready.

Personally my move was a small position in $DOGE in hopes that it becomes the micro-tipping standard, but I don't know that it really has the TPS for that. I do think Twitter could be much more valuable then it is with better self-moderation tools so that you're not exposed to the trolls, bots, and culture wars if you don't want to see it. Let people tweak their filters and share blocklists, that kind of thing. There's so much panic about letting people speak freely, but really the danger is algorithms rolling dice on what accounts to amplify. Just show me what my network is talking about and stop injecting "what's popular" into my feed.

TPS?

Transactions Per Second

It'll be interesting to see who makes up the bulk of Twitter shareholders. If it's investors who would like to get a nice quick return on their investment and free up funds to use elsewhere, the Board is going to incur their wrath. But if it's mostly investors looking for long term growth and they believe Twitter can provide that, this would be a way of creating stability.

The global economy is very volatile right now so it wouldn't be surprising if some investors weren't thrilled about the prospect of suddenly needing to find a new place to put their resources. But is Twitter itself really all that stable? Lots of new competitors are popping up, the reputation of the company is constantly taking a beating, and it doesn't appear to have much of a plan for generating stable cashflow, at least not at a level you'd want for its valuation.

I expect at least a couple of investors to speak up loudly in opposition to this plan but have no idea if they'll be the majority.

This seems to be a rare situation where the externalities of the company are as big as the internalities. Investors with strong political preferences might take stances that conflict with their financial interest because of perceived political impact that Twitter has. Just a thought.

If I read this correctly, basically if someone acquires 15% of the stock, then all of the other shareholders have to option to buy more stock at half-price. Is that correct? Where do these shares come from--are they just considered newly minted shares?

If so, couldn't something like this backfire or otherwise be circumvented? You're Musk and you want Twitter so you've started by buying 10% of the stock. Can't you just setup several shell companies, each of them also buying significant stakes each (say, 10% each). You're still going to eventually get enough to gain control... Heck, you could even then trigger the right outlined here by having Musk go over 15% and exercise your 100% of your rights in shell companies, potentially diluting other shareholder's overall stake in the company since not 100% of them will exercise the right (although I suppose that would be a bad/expensive idea if these share newly-minted shares). (???)

Do you really think these poison pills are not thought through?

Yes, they are newly minted shares.

The poison pill applies to any person, entity or group. If Elon has other shell companies, or even just people acting in concert with him, they are all excluded from the right to buy. They all get diluted.

Doesn’t that assume that Twitter actually knows that Elon is behind them? They could simply be other investors who have already decided to sell to Elon.

Sure, but that would be illegal and won’t happen. The SEC has filing requirements and the poison pill, if triggered, probably requires certain representations to be made (e.g. the buyer of the newly minted shares does not hold more than X% when aggregated with anyone they are acting in concert with).

But then he can just keep on buying those shares secondhand, right? (Or, since they’re fungible, “buy more shares”.)

The poison pill. This is going be super interesting to watch play out. Pretty much eliminates the hostile takeover from being feasible unless they want to bury many more billions to get it done. But Twitter is going to get their butts sued left and right for breaching fiduciary duty to stockholders.

Has anyone found the filing running around on the internet and not just the pr dump? The interesting missing bit is the price set on these.

"to purchase, at the then-current exercise price, additional shares of common stock having a then-current market value of twice the exercise price of the right"

It’s a US federal holiday. The filing won’t be posted to SEC’s EDGAR system[0] until Monday morning.

However this press release was posted on Twitter’s official Investor Relations feed[1]. So it’s probably fair to treat it as gospel.

[0] - https://www.sec.gov/edgar/browse/?CIK=1418091&owner=exclude

[1] - https://twitter.com/TwitterIR/status/1515001122603388928?s=2...

> The filing won’t be posted to SEC’s EDGAR system[0] until Monday morning.

Is this[0] the filing you're referring to? Don't know the first thing about the SEC, filings, or any of that, but Musk shared[1] this link yesterday.

[0] https://www.sec.gov/Archives/edgar/data/0001418091/000110465... [1] https://twitter.com/elonmusk/status/1514564966564651008

Related ongoing thread:

Twitter board adopts poison pill after Musk’s $43B bid to buy company - https://news.ycombinator.com/item?id=31043439 - April 2022 (286 comments)

many of you said its pump and dump.

i'll like to know how. Twitter price chart shown its been on decline. it got a pump from the news that Elon bought 9%. do you believe the stock going up with Twitter's poison pill? unless Elon is looking for a tax write off. is he going to sell for less?

>Buyout firm Thoma Bravo approaches Twitter with acquisition interest

https://www.reuters.com/technology/buyout-firm-thoma-bravo-a...

Well, Twitter is definitely « what's happening and what people are talking about right now. »

Good analysis here:

https://redstate.com/brandon_morse/2022/04/15/a-new-player-e...

What happens next here? Elon's lawyers fire back and challenge this?

I think the threat is that he dumps his entire position and craters the stock price.

Good chance his goal was a pump and dump. So far it's working.

That makes no sense because it hasn't really pumped. Stock price is basically where it was 5 days ago.

Look at where it was a month ago.

it wen up after the news break about Elon bought 9%.

I am not sure how comparing against a value from 5 days ago will help. Twitter stock shot up 27% after Elon Musk disclosed his ownership stake on April 4[1]. Although the price has trended down since then, the stock is still trading roughly 14% higher than what it did on April 1 (The trading day before the announcement).

[1] https://www.cnbc.com/2022/04/04/twitter-shares-soar-more-tha...

Right but I was under the impression the takeover bid was being discussed which happened in the last 48 hours, not his owning the stock in general. If the bid fails my guess is the stock will continue to decline. That's not what I would call an effective pump. If he wanted to pump he would just sold right away.

I would guess his intentions were noble and were based on what was best for humanity in the long run (e.g. spacex, tesla). Social media is a cesspool where the companies that own them have no incentive to clean them up because cleaning them up would cause them to lose money and affect shareholder value negatively. Taking it private would allow him to make the hard changes that would have a negative impact on short term profitability but be best for everyone in the long run.

wouldn't it be dump and dump? surely, this Twitter poison bill going to tank the stock. Twitter stock went up after Elon bought 9%.

That makes no sense to me. Elon is already the richest man in the world. What would be the need for a few extra billion dollars, at the cost of endless lawsuits?

My intuition is that his plan is genuine. He is buying Twitter’s audience, not Twitter’s product.

I'm not sure what standing anyone at T would have to sue him after a move made to counter him buying it... after he made a public offer like that.

It would make perfect sense to just sell and go for plan B (buy through multiple people/off-shores or something).

Are poison pills usually challenged successfully from someone with non-binding offers?

The most bizarre part of this whole saga has been the legions of online commentators who evidently take Elon at his word when he says he is trying operate in the public interest, or that his actual aims are what he says they are.

It seems patently obvious to me that all of the actions he's taken over the entire time he's been in the public eye have shown him to be an incredibly vindictive egomaniac and serial liar interested only in his own aggrandizement. I find the apparently deep well of credibility he has with the public to be completely baffling.

> It seems patently obvious to me that all of the actions he's taken over the entire time he's been in the public eye have shown him to be an incredibly vindictive egomaniac and serial liar interested only in his own aggrandizement.

I still think the world, and the USA in particular, would be better with him at the helm than the current biased leadership.

Would be more fun too!

He's a vindictive egomaniac and serial liar with a sense of fun, a good dose of perspective, and a ton of panache. I might not trust him, but he's great entertainment.

I think people exaggerate about him way too much in each direction. He's not the smartest man alive, and he isn't a fraud on par with Elizabeth Holmes. He's a businessperson who's clever at times and childish at times, like most people. I have yet to see a politician or company head that is infallible. All that being said I don't think he'd make a great politician-- just because you're a brilliant engineer doesn't mean you're gonna know how to run a country

I think he appeals to the people who want him as a politician for the same reason Trump appealed to his supporters: they're dissatisfied with politics as usual, they want change at almost any cost, and he's a middle finger at the people they dislike. That's not good justification for a gamble with the whole country, but these people see it as time for a Hail Mary. Sometimes I feel that way too; then I put down my phone and take a walk.

This is very well said. People who can create a cult of personality and offer simple, but uselessly vague, solutions to complex problems are in vogue these days.

>Sometimes I feel that way too; then I put down my phone and take a walk.

Thats because you can. What about the people trapped in terrible dying towns with no prospects for the future? People whose friends and families are drowning with opioid addictions. People who twice voted for newcomers like Obama and are now considered racists/traitors for trying something...anything to stop the bleeding.

The US is currently run by vindictive egomaniacs and serial liars. At least Musk has a sense of fun!

How have you experienced bias from the current administration?

There's countless examples. A big one from the 2020 election was banning any organization that tweeted about (at the time candidate) Biden's son Hunter's infamous laptop: https://nypost.com/2022/03/18/how-big-tech-media-and-dems-ki...

Clearly that was bias to suppress negative information about potential corrupt dealings of Joe Biden's extended family and likely him as well.

A more recent cultural example would be banning the satirical website Bablyon Bee for a joke article: https://www.forbes.com/sites/petersuciu/2022/03/21/the-babyl...

Because that contrasts with the leaderships own personal beliefs, jokes like that are a bannable offense. But, an equally crass joke about Lindsey Graham being a homosexual because of his accent by Jon Stewart would be perfectly fine: https://thehill.com/blogs/congress-blog/politics/243250-why-...

So this affected you personally? You were banned from twitter?

Ask not for whom the bell tolls. It tolls for thee.

>So this affected you personally?

I hate this line of reasoning, and I also hate that it's so prevelantly used in our legal system (we have a legal system, not a justice system FWIW). This same flawed line of thought has prevented lawsuits against the government for their illegal spying. Since "no one can prove they were harmed", and "proving you were harmed is against the law" we're stuck.

Consider the following: A pending meteor impact harms absolutely no one until right before it impacts and harms everyone.

I mean, yeah I can see that. That's an analogy you can make.

How did the administration force a private company to make a choice here? I'm not following that part.

How did our corrupt, evil government force XYZ to happen?

I’m sorry but your entire logical structure comes off as absurd to me.

We have a fundamentally evil and absurd government, and you’re asking me how anyone was “forced” to do anything? Really?

I'm appalled that more people aren't pissed the fuck off about the laptop story. It's literal election tampering, but no one gives a shit because it's their side.

We really are cheerfully walking ourselves straight into 1984.

>current biased leadership.

Instead the leadership would just be biased towards Elon's whims. It would definitely be entertaining, but I'm not sure why people assume it would suddenly be more free and open. He already blocks many who disagree with him. I doubt he would have let the kid stay on who was Tweeting his public jet movements.

Patently obvious? I think there are multiple plausible explanations. Building things people want gives credibility.

I find it more bizarre people have such passionate anger towards others.

I don't have 'anger' towards him, although I certainly have an opinion about whether he is trustworthy or genuinely civic-minded, as I do about many other incredibly powerful political-business operators who collectively set the terms of public life.

Of course, I'm also baffled that people credit him as being a 'builder' rather than an extremely successful marketer and financial engineer, especially at the expense of all the people who, you know, actually do the building...

You think he didn't build anything? He wrote the code for his first startup and is the Chief designer at SpaceX. Listen to some of his interviews, especially by everyday astronaut. He is indeed the Chief Deigner.

I don't think he is a good marketer - he is more middle of the road. I think people say that to discredit him. Have you watched any of his full length presentations. He is terrible. What he is good at is having a vision he believes in. He sells that well.

Musk is an engineer. That is just a fact about him. There are repeated comments to this effect from people who have worked with him, including famously well regarded engineers. If you watch his 3-part Starbase tour with Everyday Astronaut it is incredibly obvious. Some quotes to this effect, though certainly not all, have been collated at [1].

[1] https://www.reddit.com/r/SpaceXLounge/comments/k1e0ta/eviden...

Do you think engineers are fundamentally/inherently "trustworthy or genuinely civic-minded"? If not, how does this concern browserman's point?

I was addressing the second paragraph, not the first.

The word "engineer" does not appear in browserman's post except to say Musk is one, and "builder" is not a synonym of "engineer".

Now this is just playing semantic games. Nobody has ever claimed Musk is building Tesla's cars or SpaceX's rockets by hand. Obviously those are built by the factories and the people employed their for that purpose.

There is no way browserman's point was legitimately something not contradicted by the quotes I linked.

> “He’s not afraid to get his hands dirty,” Mueller said. “He’s out there with his nice Italian shoes and clothes and has epoxy all over him. They were there all night and tested it again and it broke anyway.”

>Of course, I'm also baffled that people credit him as being a 'builder'

I'm on the other hand baffled that so many here are willing to spout off opinions like this without even so much as having listened to the man talk. He is _clearly_ an engineer's engineer.

This topic really highlights the people who form their entire mental model of reality around news headlines.

I agree that he is great at talking.

> Building things people want gives credibility.

nope, it generates hype. That's all there is.

Up until very very recently they were losing money on every car they made and only a pandemic killing enough factory workers worldwide to create shortages have they managed to break even. What Tesla made money on is regulatory credits.

A year ago

https://www.caranddriver.com/news/a36266673/teslas-q1-2021-e...

> The company had an income of $438 million, including a $101 million "positive impact" from the sale of Bitcoin, and $518 million from selling zero-emission regulatory credits to other automakers. That means Tesla continues to lose money making and selling vehicles.

The Boring Tunnel Company barely have built anything and what they did build is a deathtrap.

Hyperloop is completely impossible.

SpaceX's Starlink satellites are involved in about 1,600 close encounters between two spacecraft every week, ~50 % of all such.

Also, Elon Musk already committed a federal felony as a twitter user and it is beyond bizarre he is a) not in jail b) allowed to bid on it.

>Also, Elon Musk already committed a federal felony as a twitter user

Surely he is innocent until found guilty. Just because you think he committed a crime doesn't mean he actually did.

You think he would've settled for $40mil and heightened personal scrutiny if he was innocent?

He talks about this in the latest TED talk. Supposedly banks were refusing to give Tesla loans unless he settled with the SEC

It's very surpring that he wouldn't admit being guilty and would find excuses instead :)

Yes, Elon was unlawfully pressured to settle with the SEC against his will or best interests.

At the time Tesla was in a "precarious" financial position with the Model 3 ramp up. The banks told Elon they would suspend his lines of credit/hold loans if he did not immediately settle with the SEC.

He chose to settle with the SEC and admit to lying when he did not in order to save Tesla from going bankrupt. All of this aligns with publicly known information.

If we lived in a functional open society this claim would result in a special counsel investigation into the SEC and the responsible banks, with multiple bureaucrats ending up behind bars.

It sounds like "the banks," who would be in an even more privileged position to know if the $420 offer was legitimately secured, also thought it was not. Doesn't really help Elon's case. It is also not the story he told in 2018 when he was still fighting the charges.

> a special counsel investigation into the SEC and the responsible banks, with multiple bureaucrats ending up behind bars.

lol

>It sounds like "the banks," who would be in an even more privileged position to know if the $420 offer was legitimately secured

Speculation. What's not speculation however is that the company suffered material harm as a byproduct of malicious prosecution.

If I, as a government employee, open a public investigation into someone whom I know to be innocent and cause that entity harm I have incurred liability. The SEC knew Elon had the funding, they used weasel words to imply he did not. The SEC would have lost in court. _All_ contracts have contingencies, this was no different. Saying that because a contingency existed the funds were "not secure" is horsecrap.

> The SEC knew Elon had the funding

Do you have proof - or even evidence - that Musk had funding, let alone that the SEC knew he had funding, other than Musk's own statements?

This is sort of exactly the thing I mean. Even if you don't agree with me that Elon is a serial liar, I don't think you can dispute a more generous characterization of him as having a long history of optimistically interpreting the facts in his favor. Why on earth would you take this claim at face value?

Why on earth would you believe an industry that’s committed to serial mistruth?

Reuters today disgraced themselves, it’s beyond embarrassing.

People settle all the time even if they are innocent. There are a variety of reasons such as the cost of the lawsuit and the negative press from the trial.

>Up until very very recently they were losing money on every car they made

For others in the crowd, this phrase is extremely useful for spotting a short seller (or someone who was primarily influenced by the short-n-distort crowd from 2016-2019).

This statement is a lie, and was never true. Every car Tesla made was produced and sold at a profit. Their high margins fed crazy growth. You can only get to these bullshit statements by counting their reinvestment into factories as "loss".

For example:

-Make car for $40k

-Sell for $50k

-$10k/per car profit

-Make $xM in profit from cars for that quarter

-Raise $1B to grow based on the above

-Spend some of that $1B on factories, such that the total spent of that $1B is more than $xM

-Short n Distort campaigners argue that because you spent more than you made, you are "losing money on every car".

I never ever trade individual stocks , that's not for ADHD people. My savings rest in unmanaged index funds.

He's gotten results where others have provided only talk.

You see this sort of comment a lot.

It's a non-sequitur that seems the be the answer to any criticism of Musk and his actions.

He's built an electric car company and cheap reusable rockets. Nobody else has.

What have his critics accomplished?

Yep, that's the one I was thinking of. The guy I replied to was a weaker version of it but yours is essentially canonical.

I want the zealots at Twitter who don’t believe in free speech to leave.

Musk is right on this one, I hope he succeeds in taking it over.

HN also has fairly strictly enforced guidelines. Do you think dang et. all 'don't believe in free speech'?

A lot of people here on HN are anti free speech.

I'm not who you are responding to, but I think it is a different scenario.

HN has a very specific and limited topic range that is allowed and documented. There is some subjective things in what is allowed, but it is generally understood. People are not complaining about that. Nobody is suggesting HN should allow general sports news for example.

Twitter on the other hand is a general forum and so it should allow a broad amount of topics. If Twitter was a specific and targeted platform for cat pictures nobody would have an issue if they banned politics.

This is not even about the topics. HN has very clear moderation rules about tone of comments for example, rules against astro-turfing, rules about accusations of astro-turfing, and many others. Comments have to be substantive, otherwise they are voted down. Comments must not encourage flame-bait, otherwise they are removed.

HN is very highly moderated and you could even say tone-policed, and that is a major part of why many of us here like it.

Even Hacker News restricts abusive behavior, whether or not it's technically on topic. There are limits above and beyond an acceptable range of topics. Maybe I could get away with more here than Twitter, but not all behavior is permitted.

"Free speech" as in no restrictions, and if Twitter gets overrun with spam and child porn then so be it? I suspect that you (and Musk) actually do want some restrictions, just different ones than Twitter currently has.

Elon's "fans" are legion, and are not driven by logic.

Where are they? I see them failed against multiple times a day, but only see the complaints about them, and not the actual subject of those complaints.

I'm an Elon fan. I keep trying to buy SpaceX stock (it's privately held) and don't even care if I lose the money. I just want to be part of the action.

Thankfully the same SEC hellbent on taking down Tesla is protecting you from investing in SpaceX!

You sound fairly rational to me. Do you, in fact, worship the ground he walks on?

Musk has a long history of just saying what he means. He often fails to deliver on things that were too ambitious, or pivots to better ideas in time, but that's entirely different than what you are suggesting.

He has a long history of outright lies that he presents as visionary ambition. For example, at the time he was promising that Tesla's with full self driving, available one year from then, would act as robotaxis and bring their owners enough money to recoup their investment in a year, he was obviously lying through his teeth - he knew full well that nothing like that will ever happen.

Similarly, his lies about starship being used as an earth-to-earth mass transportation system are equally transparent.

Not to mention the time he lied about financial plans for Tesla with the express purpose of manipulating the stock price, such as the Twitter thread that cost him his nominal role as chairman of the board.

I'm not a fan of Elon Musk, but I think his greatest flaw is hubris. I don't think he was consciously lying about things like Tesla FSD. I think he thought he would actually do it in the time he predicted but he overestimated his own abilities and domain knowledge.

Having said that, after so many past exaggerations one would hope he would have more self-awareness by now. I guess not.

> I think he thought he would actually do it in the time he predicted but he overestimated his own abilities and domain knowledge.

If he truly believed that a Tesla would recuperate its value in one year by the profit it would make as a robotaxi, he wouldn't have sold any Teslas, as they would make MUCH more money by running a robotaxi fleet than by selling cars.

You're not totally wrong here. However the same is true of computers - a computer "fleet" makes much more money than the profit on the components, but Intel is not out there operating AWS-style datacenters.

I think there's such a thing as "core competency". It's possible that Musk views Tesla's core competency as building vehicles and vehicle software, not running a logistics-heavy operation like a robot taxi fleet.

That strategy gives you better margins. It doesn't give you better revenue or profits. The biggest problem Tesla had as a fledgling car company was cash flow, and the solution to that is scale and sales. FSD can be converted to immediate revenue by just charging for it, which is more cash-flow efficient than running a centralized taxi service. They have announced they have a dedicated rideshare vehicle in the works, and it's likely something of that nature was always in the works.

Underestimating the complexity of autonomous cars, overestimating his abilities and domain knowledge, continuous lying about it (even if not consciously) sound pretty stupid to me. Like, textbook Dunning-Kruger.

The most bizarre part of this whole saga has been the legions of online commentators who appear to be persistently outraged, say they will leave Twitter if Elon buys it. It amounts to throwing a childish temper tantrum in my book. Free speech doesn’t mean one side gets to decide what’s speech.

For years liberal billionaires have been buying traditional media (newspapers), but as soon as Elon who slightly offends their political and personality identity attempts to buy what is currently relevant media they lose their minds. Smell that hypocrisy?

“Free speech” can have a few meanings.

There's the 1A one, where the government isn't to restrict your speech, and you can argue about absolutism (fire in a theater, etc.)

And there's the suggestion everyone should get a free platform, and suffer no consequences for whatever they say. In other words, acting like a ten year old (or not even that. Some 10yo are much smarter than that, and realize their acts have consequences)

Nobody is suggesting you shouldn't have consequences for what you say. People are saying you shouldn't be banned for things that legal.

Fire in a crowded theater, xenophobic comments to a trigger happy crowd…

I'm not sure what are you getting at?

Is that not a consequence? Private business and all that

I think everyone should leave Twitter whether Elon buys it or not. It's a platform that often amplifies people's worst tendencies. Changing how much free speech Twitter allows won't change that.

It's rare, but not new; Steve Jobs was also worshipped as some kind of infallible God-King. It seems to me there is a lot of overlap between their two flocks.

Elon Musk has a cult of followers. Obviously SpaceX and Tesla have done incredible things but it doesn’t justify blindly following whatever Elon wants to do.

Honestly the hardcore Elon orthodox is annoying. It reminds me of the obnoxious atheist who has to always tell everyone how wrong and dumb they are. It only detracts positive outcomes and causes more resistance.

> it doesn’t justify blindly following whatever Elon wants to do.

Actually, it does. When someone starts multiple impossible companies, and makes big successes out of them, it's not random chance anymore. I'm willing to bet on the man.

Bill Gates pivoted Microsoft 3 times, each time led to orders of magnitude increases in the company's value. 3 times is no longer chance, it's the man.

Ditto for Steve Jobs.

So Elon Musk is gospel, no skepticism towards any decision he makes. Sorry, I can’t get on board with this, it’s fanaticism.

Let's take Michael Jordan. He wins 3 seasons of basketball in a row. Would wanting him playing on your team be good sense, or fanaticism?

My bets on Gates, Jobs, Bezos, and Musk continuing to be winners has so far paid off.

Hell yes I’d want him on my basketball team. Do I want Michael Jordan dictating a social media platform that has influence over the world? I don’t know?

>> It seems patently obvious to me that all of the actions he's taken over the entire time he's been in the public eye have shown him to be an incredibly vindictive egomaniac and serial liar interested only in his own aggrandizement.

Sounds remarkably like Jack Dorsey.

What lies? Let's iterate through them.

If you're referring to the funding secured thing, that was true. Watch his TED talk from yesterday where he explains that he was forced to concede by the SF SEC.

"L5 autonomy by the end of the year" (since 2019 or so)

By this logic, every company that fails to meet its goals is a liar.

Repeatedly, with a background of stock manipulation, yes.

This is most likely a "poison pill" enacted to prevent Elon Musk from successfully performing a hostile takeover.

https://www.axios.com/twitter-elon-musk-poison-pill-7a62f6d6...

This is the very definition of a corporate poison pill.

Excellent! I’m sure that Saudi Arabian prince (who the media and its followers have been citing ad nauseum for some strange reason as to why Twitter shouldn’t accept the offer) will be very happy now. Because, you know. A Saudi Arabian prince is who we should be listening to when it comes to American policies, companies, and institutions.

>... for some strange reason...

I mean, he's a shareholder who owns 5.2% of Twitter. Not so "strange".

based on this Bloomberg[?] screen he has no positions in Twitter as of 2019 https://twitter.com/zerohedge/status/1514747126210863108

I guess Musk will have to go with Plan B, then. I would guess he will start his own Twitter competitor much like Trump did with Truth Social, and he has the star power to actually create the network effects needed to bootstrap a new social network. In addition to him selling his current 9% share of the company, this is likely very bearish for Twitter's stock price.

Trump had enough star power to get some 75 million people to vote for him, and Truth Social has been a flop.

This should be sufficient evidence that the rhetoric about legions of vitriolic, idiotic "Trumpers" is just progressive propaganda...

Could also mean that group isn't one you can build a successful product around, even if they do exist.

Truth Social appears to be stillborn mostly due to technical incompetence. Otherwise, it might have been at least somewhat successful in crowding out the gabs, gettrs, etc.

I believe Musk would hire the proper talent and wouldn't screw up a launch this badly.

Perhaps but you're talking a year or more of building. Also, while there are plenty of Muskboys on HN, I don't think he has the star power that guarantees success, so it'd have to be something more than just "Twitter without moderation", resulting in a pretty long lead time to alpha v1.

More likely he would just buy a different platform, since many of his companies he hasn't created from the ground up.

I don't really understand why anyone thinks a Musk social media platform would be much more serious or likely to succeed than a Trump one. Musk is more successful than Trump but Trump was the US president so it kind of seems like a wash. Neither of them seem to have the capacity (by choice) to fully focus on a social media platform the way they'd need to for it to be successful.

Most people, even the conspiratorial type who believe Twitter is some illuminati censorship machine, realize when the rubber hits the road that..

Twitter censorship is not a practical problem for them. It's a practical problem for Trump sure lol, but:

"Oh.. I'm not going to be able to @Operah and fool myself into thinking she reads my tweets because she's not on "Disgruntled Social"? ..."

Musk starting his own thing and taking the Muskovites with him would be a huge win for everyone. A bit like Ark Fleet Ship B.

The last part of that story involves everybody in ships A and C dying. Careful what you wish for.

Almost worth it.

Twitter is like the 8th largest social network. That's a lot of work to fight over scraps.

This is good. He had no real plan to help the company anyway. Twitter does not need a part-time CEO.

he doesn't have to run Twitter. he can leave it to someone whom he trust like Gwynne Shotwell w/SpaceX. it work perfectly for SpaceX.

Someone needs to change the culture there, get the egotistical censors out of the company.

I’d trade 20% of Elon for 100% of the vast majority of CEOs in an eyeblink.

> Twitter does not need a part-time CEO.

It had one in Jack for a long time.

But more to the point, did Elon ever propose becoming CEO? I don't believe I ever saw anything from him to that effect.

Considering what Musks reputation is for creating shareholder value, and the meme power he has, at some point existing shareholders could get really pissed at the board if they are sabotaging a really big payoff.

Unless of course there are some back room political games going on, which wouldn’t surprise me.

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