If Elon Musk buys Twitter, he will stop paying its board members
The billionaire took to Twitter to explain how he planned to reduce company costs by not paying board members. Who earn between $250,000 and $300,000 per year. Employees and shareholders at Twitter have reportedly been stress and dissatisfy since Musk purchase nearly 10% of the company’s shares, fearing internal change and shifts they disagree with.
Musk’s most recent tweet on the social media platform is direct evidence of this.
On Monday, If Elon Musk buys Twitter responded to a Tweet from Gary Black, a managing partner at Future Fund. Stating that if Twitter became a private company under Musk’s ownership, board members would no longer be paid.
They are currently paid between $250,000 and $300,000 per year, for around $3 million per year.
“The board’s role is to represent shareholders,” wrote Black. “They should be remove also replaced by new board members. Who understand their fiduciary obligations if they refuse to feat in the best interests of SHs.”
Musk responded by adding to Black’s statement.
“Board salary will be $0 if my bid is successful, $ 3M/year saved right there,” Tesla CEO Elon Musk wrote. Musk remains Twitter’s largest individual shareholder, but investment firm Vanguard has surpassed Musk as the company’s largest shareholder, owning approximately 10.3 percent of Twitter shares.
The billionaire was invite to join the Twitter board of directors but declined on April 9, his official first day.
“Elon announced that he will no longer be joining the Board of Directors that same morning. Twitter CEO Parag Agrawal said, “I believe this is for the best. We have valued also will continue to value shareholder input, whether they are on our Board or not. Elon is our big shareholder, and we will continue to welcome his input.”
However, Musk’s proposal is likely to be deter by shareholders who oppose his takeover.
Private equity firm Apollo Global Management has also been report to be in talks to buy Twitter before Musk does in a “preferred equity” type plan. However, the firm has not publicly commented on or confirmed the rumors.