Twitter investors meet amid turmoil over Elon Musk takeover bid | Twitter

Twitter shareholders gathered on Wednesday for their regularly scheduled meeting, as the company faces turmoil over billionaire Elon Musk’s $44bn takeover bid.

Wednesday’s gathering did not include a vote on Musk’s plan to buy the social media platform – that vote will take place at a yet-undetermined date in the future.

But the shareholders raising proposals for a vote frequently invoked the Tesla CEO’s name.

Investors on Wednesday preliminary approved one proposal, by the New York state common retirement fund, that called for a report on Twitter’s policies and procedures around political contributions using corporate funds.

Two proposals brought by conservative-leaning groups failed to garner enough votes to pass. 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 “themselves deeply racist”. The other sought more disclosure on the company’s lobbying activities.

Investors also blocked the re-election of a Musk ally to the board, voting against Egon Durban, the co-head of private equity firm Silver Lake, who partnered with Tesla CEO Musk on his abandoned bid to take the electric carmaker private.

“The Twitter board has not embraced Elon Musk and his vision for Twitter. 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 what he offered, but investors are expected to overwhelmingly approve the deal.

Twitter’s board initially voted to adopt a “poison pill” that limited Musk’s ability to raise his stake in the company, but later voted unanimously to accept his buyout offer.

Musk in April reached a deal to buy the social media platform at $54.20 a share. But he said in May the deal cannot progress until the platform proves that fewer than 5% of its users are fake or spam accounts.

The sharp turnaround by the world’s richest man makes little sense except as a tactic to scuttle or renegotiate a deal that is becoming increasingly costly for him, experts said last week. That the discussions are playing out publicly, on Twitter no less, only adds to the chaos.

Experts say Musk cannot unilaterally place the deal on hold. If Musks walks away, he could be on the hook for a $1bn breakup fee. Alternatively, Twitter could sue Musk to force him to proceed with the deal, although experts think that is highly unlikely.

Even if shareholders approve any of the proposals, it will be non-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, a general partner at Inovia Capital, to the board.

Shares of Twitter were up $1.09, or 3%, at $36.83 in early afternoon trading on Wednesday.

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