In the bad old days, this would be called "greenmail". It was frowned upon. Illusory offers to buy companies, or else the mailer would "make trouble". Boards usually voted to buy the mailer out. Buy back his shares. But this is a different. . . day. The board here can -- and likely will -- just let him twist in the wind. He's put himself in a very stupid position -- $3.4 billion likely to go to. . . waste.
Some observations: his letter by its terms, says it is non-binding. And he only wants to "go private" with Twitter. He implies (but does not say directly) that if he cannot achieve a going private transaction, he will likely sell his stake. So, Vanguard and the other larger institutional holders are likely to oppose his "offer". They almost always side with management in such "greenmail" cases (last prominently seen at the end of the 1980s).
Finally, his offer undervalues Twitter, at an only 38% premium. He'll need to put about 26% of his net worth into this deal, or about $85 billion -- doubling his offer, if he really wants control, and to take Twitter private.
But as I say -- I think it is just the highest priced sh!t-post in the history. . . of history.
Just as his "board seat" was just the highest-cost focus group ever run -- as he was to be only one of eleven votes.
But if he does not now promptly disclose at the SEC's EDGAR window, on the very day he begins liquidating his position, or "changing his mind", as he says -- there's a nice orange jumpsuit ahead -- for him.
I actually thought he'd find better advice than he's getting -- or perhaps he's just not listening to it. . . but that is a "no-news there" moment, right?
His SEC jacket just doubled in length -- at the Enforcement Division.
Charming.
नमस्ते
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