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Announcing Monday that majority shareholder Elon Musk had declined to join the company’s board, the Twitter stock plunged as much as 8 percent in premarket trading.
Twitter’s board of directors offered Musk a seat on Tuesday. His appointment was to take effect on Saturday after he disclosed a 9.2 percent stake only a couple of days ago. Despite this, Tesla Chief Executive Parag Agrawal disclosed Sunday night that the CEO had decided to turn down the offer.
‘Elon shared that same morning that he will no longer be joining the board’, tweeted Agrawal. He added that he thought it was ‘for the best.’
Musk, 50, has not publicly commented on his decision, but he sent out a tweet early on Monday showing an emoji of a smiling face, with its hand covering its mouth – apparently an expression of rapture, a smirk, a shy smile, or joy. A short time later, he deleted it.
In response to Agrawal’s announcement, several Twitter employees expressed anger over Musk’s involvement with the company, including one researcher who called it ‘the drama that keeps on giving.’
Twitter’s stock dropped to its lowest level Monday morning, costing Musk nearly $274 million. Friday’s market close valued his stake at $3.39 billion.
In premarket trade on Monday, Twitter shares fell 8 percent to less than $43 per share.
By 7.30 am shares had recovered slightly and were trading at $45.20 per share, a decline of only 2.23 percent.
Twitter stock prices soared over the last week after news of the billionaire’s involvement broke. On April 5, the Twitter stock hit a high of $53.84 per share.
Several analysts believe Monday’s decline was influenced by his refusal to join the board.
Musk’s appointment to the board would have taken effect on Saturday, ‘contingent on a background check and formal acceptance,’ Agrawal had said earlier.
Musk posted a hilarious meme about it.
— Elon Musk (@elonmusk) April 7, 2022
‘The board and I had many discussions about Elon joining the board, and with Elon directly,’ noted Agrawal. ‘We were excited to collaborate and clear about the risks.
‘We also believed that having Elon as a fiduciary of the company where he, like all board members, has to act in the best interests of the company and all our shareholders, was the best path forward. The board offered him a seat.’
However, after weeks of tweeting about changing Twitter and conducting online polls, Musk changed his mind.
The Twitter CEO encouraged employees to stay focused despite the announcement, saying: ‘There will be distractions ahead but our goals and priorities remain unchanged.’
Despite this, his employees seem upset by the whole situation.
‘My drafts folder deserves agency representation at this point,’ said Lara Cohen, Global Head of Partners.
A marketing employee at the company, Ej Samson, said he was looking forward to discussing the progress with colleagues who work hard and show up every day, even if not in an office.
Using the hashtag #spongebobsquarepants, Twitter researcher Matt DeMichiel shared a picture of the cartoon character’s face plant in the sand.
— Matt DeMichiel (@mattdemichiel) April 11, 2022
The CEO of SpaceX would have been limited in how much he could own if he had been elected to the board, with a cap of 14.9 percent.
As a passive investor, Musk may now plan to take over the company in a hostile takeover.
The complex network of business interests of Musk’s may have raised questions during the background check, others on social media speculated.
The Twitter CEO didn’t comment on Musk’s decision.
Musk had suggested slashing the price of Twitter Blue premium subscription service, banning advertisements, and offering Dogecoin as a payment option on Saturday.
A second tweet read: ‘Delete the w in twitter?’
Musk also asked: ‘Is Twitter dying?’
Most of these “top” accounts tweet rarely and post very little content.
Is Twitter dying? https://t.co/lj9rRXfDHE
— Elon Musk (@elonmusk) April 9, 2022
Agrawal went on: ‘We announced on Tuesday that Elon would be appointed to the board contingent on a background check and formal acceptance.
‘Elon’s appointment to the board was to become officially effective 4/9, but Elon shared that same morning that he will no longer be joining the board.’
Agrawal didn’t elaborate on why Musk wouldn’t join the company’s board.
Nevertheless, he said: ‘I believe this is for the best.
‘We have and will always value input from our shareholders whether they are on our board or not.’
Elon has decided not to join our board. I sent a brief note to the company, sharing with you all here. pic.twitter.com/lfrXACavvk
— Parag Agrawal (@paraga) April 11, 2022
He continued: ‘Elon is our biggest shareholder and we will remain open to his input.’
‘The decisions we make and how we execute is in our hands, no one else’s.
‘Let’s tune out the noise, and stay focused on the work and what we’re building.’
Following Musk’s appointment, Twitter was planning to host a staff Q&A session.
Musk was also scheduled to deliver a TED talk on Thursday morning in Vancouver, but it is uncertain whether that event will take place as planned.