What you need to know
- Elon Musk is joining Twitter's board for two years after buying a 9.2% stake in the company.
- Twitter CEO Parag Agrawal confirmed Musk’s appointment to the board.
- He will serve as a class II director until 2024, but his ownership stake is limited.
Elon Musk has been appointed to Twitter's board of directors for a two-year term, a day after purchasing a 9.2% stake in the social media company, a filing with the Securities and Exchange Commission has revealed.
He will serve as a Class II director for two years, with his term ending at the company’s 2024 annual stockholders meeting. Twitter CEO Parag Agrawal also confirmed Musk's new position on the company's board.
I’m excited to share that we’re appointing @elonmusk to our board! Through conversations with Elon in recent weeks, it became clear to us that he would bring great value to our Board.April 5, 2022
"He’s both a passionate believer and intense critic of the service which is exactly what we need on Twitter, and in the boardroom, to make us stronger in the long-term," Agrawal added.
In response, Musk teased "significant improvements" that he intends to introduce to the social media platform in the coming months.
Musk previously chastised Twitter for "failing to adhere to free speech principles." His 9.2% stake in Twitter is estimated to be worth $2.89 billion. This grants him ownership of 73,486,938 shares, making him Twitter's largest individual shareholder.
However, there are key conditions limiting Musk's ownership stake to prevent a potential takeover. According to the SEC filing, he can't own more than 15% of the company while sitting as a board director.
"For so long as Mr. Musk is serving on the board and for 90 days thereafter, Mr. Musk will not, either alone or as a member of a group, become the beneficial owner of more than 14.9% of the company’s common stock outstanding at such time, including for these purposes economic exposure through derivative securities, swaps, or hedging transactions," the filing states.
