After purchasing a 9.2 percent investment in Twitter, Elon Musk will join the company’s board of directors.
“It became evident to us in recent conversations with Elon that he would offer enormous value to our Board,” CEO Parag Agrawal said in a tweet.
“On Twitter, and in the boardroom, he’s both a passionate believer and an intense critic of the service, which is precisely what we need to make us stronger in the long run,” Agrawal added.
Musk “cares profoundly about our world and Twitter’s place in it,” according to former CEO Jack Dorsey, who hailed the move in a tweet.
Dorsey later stated, “I’ve wanted Elon on the board for a long time.”
According to a filing with the Securities and Exchange Commission, Musk’s tenure will end in 2024.
Musk cannot be the beneficial owner of more than 14.9 percent of the company’s outstanding common shares for the duration of his board term or for 90 days afterward.
While Musk’s holding is the greatest among outside owners, it is classified as a passive interest, which indicates the holder isn’t attempting to control or influence the company.
In a letter to investors, Wedbush analyst Dan Ives wrote, “We expect Musk joining Twitter will lead to a plethora of strategic initiatives, which could include a range of near-term and long-term options out of the gates for the firm presently suffering in a social media arms race.” “It’s time to break out the popcorn and watch what happens with Musk on the Board in the next months,” Agrawal added.
Twitter’s stock rose 2% on Tuesday as a result of the announcement.
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