Twitter shareholders gathered on Wednesday for their regularly scheduled meeting as the company faces agitation over the $ 44 billion takeover bid from billionaire Elon Musk.
Wednesday’s meeting did not include a vote on Musk’s plan to buy the social media platform: that vote will be on a date yet to be determined in the future.
But shareholders who put forward voting proposals often invoked the name of Tesla’s CEO.
Investors on Wednesday preliminarily approved a proposal from the New York State Commonwealth Retirement Fund calling for a report on Twitter’s policies and procedures around corporate-funded political contributions.
Two proposals submitted by conservative groups did not get enough votes to approve them. One called for an audit of the company’s “impacts on civil rights and non-discrimination” and referred to “anti-racism” programs that seek to establish “racial / social equity” as “deeply racist themselves”. The other asked for more information about the company’s pressure activities.
Investors also blocked the re-election of a Musk ally on the board, voting against Egon Durban, co-director of private equity firm Silver Lake, who partnered with Tesla CEO Musk in his abandoned offer to take the electric car manufacturer in private.
“The Twitter board has not accepted Elon Musk and his Twitter vision. So the fact that his ally has been removed from the board is not surprising,” said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh. .
The vote could indicate skepticism among shareholders of Musk’s plan or his willingness to pay for what he offered, but investors are expected to approve the deal overwhelmingly.
The Twitter board initially voted to adopt a “poison pill” that limited Musk’s ability to increase its stake in the company, but then voted unanimously to accept its takeover bid. Musk reached an agreement in April to buy the social media platform for $ 54.20 a share. But he said in May that the deal could not move forward until the platform proves that less than 5% of its users are fake or spam accounts.
The sudden change of the richest man in the world makes little sense, except as a tactic to sink or renegotiate a deal that is becoming more and more costly for him, experts said last week. That the discussions take place publicly, no more and no less on Twitter, only increases the chaos.
Experts say Musk cannot unilaterally suspend the deal. If Musks leaves, he could be stuck with a $ 1 billion breakout rate. Alternatively, Twitter could sue Musk for forcing him to continue with the deal, though experts think it’s very unlikely.
Even if shareholders approve any of the proposals, it will not be binding, said Donna Hitscherich, a professor of finance at Columbia Business School.
Twitter co-founder Jack Dorsey’s term as a board member will expire on Wednesday. Investors re-elected Patrick Pichette, general partner of Inovia Capital, to the board.
Twitter shares rose $ 1.09, or 3%, to $ 36.83 in the early hours of Wednesday afternoon.