The Twitter investors Elon Musk hopes to keep may not want to stay
Elon Musk said Thursday -- and later backed it up with a tweet -- that he wants to retain as many of Twitter Inc.’s shareholders as possible if he’s successful in his bid to take the social-media network private. First, he might have to persuade them to accept his offer.
“I should also say the intent is to retain as many shareholders as is allowed by the law in a private company, which I think is around 2,000 or so,” Musk said at a TED event in Vancouver. “We’ll try to bring along as many shareholders as we’re allowed to.”
As Musk alluded to, U.S. regulators place limits on how many shareholders a private company can have before it’s required to release the same sort of financial information that public companies have to make available. While Musk was right that the baseline number is 2,000, it drops to 500 if the shareholders don’t count as accredited investors, or high-net-worth holders that would allow the company to avoid some reporting requirements.
With a shareholder roster that includes everyone from its own founder to the biggest institutional investors and an army of retail investors, there are a lot of people who could take Musk up on his offer -- either to buy their shares for $54.20 apiece in all cash, or to roll over their stakes into a newly private Twitter.
Some of them are already weighing in on the potential deal, and using Musk’s own preferred form of communication to do so.
Ross Gerber is co-founder and president at Gerber Kawasaki Wealth and Investment Management, which owns more than 9,000 shares in the company, according to the company’s latest filings with the SEC. He tweeted Thursday:
“Lots to unpack here,” Gerber said in a message to Bloomberg News. “Shake-up is well needed. Offer is low and no
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