The largest stake in the home of online loudmouths is held by the most notable loudmouths. The wealthiest person on Earth is multi-billionaire Elon Musk, who is worth $288 billion. On the day after his investment, Musk was elected to the board of directors. Questions remain about what his role will be. He has a stake in the company and what his position on the board could be.
The initial news that Musk had acquired 9.2% of the company's stock indicated he would be a passive investor. He wouldn't be involved in the running of the company. He would be like any other stock-holder who wanted to see gains in the value of the shares. Most investors in Wall Street stocks are covered by that category.
After his stock purchase was made public, it was revealed that Musk would join the board of directors, making him an active investor. There was one condition. Zino says that he can't increase his holdings above 14.9% until his term as a director ends in 2024. Musk could buy all of the shares, or he could buy a majority of the shares. He would be in control of the company. The company's board of directors would likely be retained.
Musk has the funds to purchase the entire enterprise when the restrictions are over, so part of the possible takeover story is important. Zino doesn't rule out a full takeover eventually.
The position Musk has on the board will allow him to steer the company's business strategy and make decisions on financial matters. The board's role includes making decisions on what to pay the CEO and renewing executive employment contracts.
Zino says that being a director allows Musk to pick up the phone and speak with the management team.
While Musk wants to start a new and better social media platform, it will be more efficient for him to adjust an existing one rather than start from scratch. He is likely to skirt close to the edge of that boundary, according to experts. Whether that is what everyone else thinks is a different matter.
An edit button was suggested by Musk. The site would be in line with the practice of Facebook.
Musk pushes boundaries. He said on his feed that he would take the company private at a high stock price and had the funding ready to do so. That didn't happen. The Securities and Exchange Commission sued Musk. Musk argued that the regulators were trying to restrict his free speech, but he agreed that the company lawyers would have to pre-written future posts.
The inconsistent muting of certain speech on the platform has been criticized. Musk's apparent love of unfettered communication may lead him to change his mind about the perceived muzzling of differing views.
Morrison says that Musk has been a loudmouth in the past, but now is more mischievous. Corporate communication on social media platforms has often been the focus of naughty behavior. The SEC has said it is ok to release financial data or other news that could move a stock price on social media, but the company must announce ahead of time which platforms it will use to do so. Musk seems to push the envelope when it comes to SEC regulations.
After purchasing his 9.2% stake in the company, Musk organized a poll on the social networking site. He should have revealed the purchase earlier. The idea behind the SEC disclosure mandate is to alert investors with full information about who is buying a significant stake in a company. Information like this helps other investors make better decisions.
According to CNBC, Musk could be fined $100,000. If you are Musk, that isn't much to pay for.
Musk has had an impact on the site. Since it became public, it has been a huge disappointment for investors, lagging behind both the market and its direct competitor Meta.
The lackluster state of the underlying business is reflected in the company's market performance. The stock market lost more than 7% from when it first opened. According to data from Yahoo, Meta has gained over 370% and the tech-laden Nasdaq has gained 260% over the same period.
The price of the stock went up in its best day of gains in years when news of Musk's purchase of 9.2% of the outstanding shares broke. Some investors were optimistic that Musk's stake might revive the company. Further news that Musk had taken a seat on the company's board helped reinforce the sunnier outlook. He is likely to have more power with the company's executives because of his stock sway.
We can be reached at letters@time.com.
All Rights Reserved © 2024
