Twitter Implements Poison Pill Plan To Block Elon Musk's Attempted Hostile Takeover

Elon Musk, the world’s richest person, made an offer to acquire Twitter, only days after announcing that he would no longer be joining the company’s board of directors. Musk offered to buy Twitter for $54.20 per share, valuing the company at about $43 billion. On Friday, Twitter’s board of directors made it clear that it will not go quietly, stating that any acquisition of more than 15% of the company’s stock without its consent would trigger a “Poison pill” - a plan to flood the market with shares, making a buyout much more difficult.

The "poison pill" provision preserves the right of Twitter shareholders other than Musk to acquire more shares of the company at a relatively inexpensive price, effectively diluting Musk's stake. The provision will be triggered if any other investor acquires more than 15% of the company's shares. Elon Musk currently owns around 9% of Twitter's shares. The poison pill — a corporate anti-takeover defense mechanism — won't necessarily stop Musk's bid in its tracks, but it could make buying the company more expensive or force Musk to the negotiating table with the board.

Earnings Recap

Johnson & Johnson cut its full-year profit expectation and suspended sales forecast for its Covid-19 vaccine after predicting as much as $3.5 billion in sales from the shot

Bank of America shares jumped after the bank reported an earnings beat on Monday. Bank of America topped expectations in the first quarter with earnings of 80 cents per share and $23.33 billion in revenue, helped by strength in consumer lending.

Netflix shares drop 25% after the company reports it lost subscribers for the first time in more than 10 years

Shares of Synchrony Financial, the financial services firm advanced after the company reported a beat on quarterly profit and revenue estimates. The board also approved a $2.8 billion addition to the company’s stock buyback plan and a 5% dividend increase to 23 cents per share.

Netgear fell 10% after the network equipment and router company lowered its outlook, blaming a drop in consumer sales and supply-chain problems from Covid-19 lockdowns in China.

Halliburton trades lower despite beating estimates for its latest quarter.

Charles Schwab fell 9.4% after the company missed analyst estimates on the top and bottom lines in the first quarter. The company reported earnings per share of 77 cents on $4.67 billion in revenue. Analysts expected 84 cents per share on revenue of $4.83 billion.

And that’s it for this week. Until next time, Cheers!