Elon Musk Decides Against Joining The Twitter Board

AP News

Less than a week after announcing that Tesla CEO Elon Musk would join its board of directors, Twitter has reversed course.

Twitter CEO Parag Agrawal announced the news, which followed a weekend of Musk tweets suggesting changes to Twitter, including making the site ad-free. Nearly 90% of Twitter’s 2021 revenue came from ads.

“Elon’s appointment to the board was to become officially effective on 4/9, but Elon shared that same morning that he would not be joining the board,” Agrawal wrote in a reposted note originally sent to Tesla employees. “I believe this is for the best.”

Agrawal didn’t offer an explanation for Musk’s apparent decision. He said the board understood the risks of having Musk, who is now the company’s largest shareholder, as a member. But it, “believed having Elon as a fiduciary of the company, where he, like all board members, has to act in the best interests of the company and all our shareholders, was the best path forward,” he wrote.

The rapidly evolving relationship between Musk and Twitter began exactly one week ago when regulatory filings revealed the mercurial billionaire had amassed a 9.2% stake in the social media platform, making him its largest shareholder.

A day later, Twitter gave Musk a seat on the board on the condition that he not own more than 14.9% of the company’s outstanding stock, according to a regulatory filing.

While Musk has been one of Twitter’s loudest critics, the sudden withdrawal from the board, which became official Saturday, could signal that the rapidly evolving narrative between Musk and Twitter will become more acrimonious.

“This now goes from a Cinderella story with Musk joining the Twitter Board and keeping his stake under 14.9% helping move Twitter strategically forward to likely a “Game of Thrones” battle between Musk and Twitter with the high likelihood that Elon takes a more hostile stance towards Twitter and further builds his active stake in the company,” wrote Daniel Ives, who follows Twitter for Wedbush.

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