Shares in Twitter Inc. fell after Elon Musk decided not to join the board, after speculation the world’s richest person could mount a takeover of the social media platform.
After discussions with management, Musk decided against joining Twitter’s board over the weekend, a dramatic reversal that also ends a previous agreement to keep his stake at no more than 14.9 percent.
Twitter shares fell about 7 percent in pre-market trading on Monday in New York. The drop erases part of a week of gains after Musk revealed he had taken a stake, with investors seeming to welcome his investment.
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Musk is now free to increase his stake in Twitter and push for changes in the company as an activist investor, which has also set off speculation that he may be interested in an acquisition of the company. By staying off the board, Musk avoids the potential conflict of interest that arises when a board member has a number of financial interests that may influence how they vote.
Musk, who currently owns just over 9 percent, is Twitter’s largest individual shareholder. The billionaire behind Tesla Inc. and SpaceX has made a flurry of suggestions — via
Twitter — for changes to the company’s business model, including turning its San Francisco headquarters into a homeless shelter and adding an edit button for tweets, to granting automatic verification marks to premium users.
One of the most prolific users of Twitter, Musk has regularly courted conflict on the platform. He has called out Twitter for “failing to adhere to free speech principles” and the need to root out cryptocurrency scams that are prolific on the social media platform, which was co-founded by his friend Jack Dorsey.
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