Elon Musk refiles the SEC disclosure of his Twitter stake to classify himself as an active investor; Musk bought his stake in cash from January 31 to April 1
Elon Musk refiled the disclosure of his stake in Twitter Inc. to classify himself as an active investor, making the change …
BloombergJillian Ward
Context & Ripple Effects
Musk had first disclosed a 9.2% Twitter stake as passive, becoming the company’s largest shareholder. The refiling changes the posture of that holding from passive ownership to active investment after cash purchases running from January 31 through April 1.
Twitter and its shareholders must treat Musk’s 9.2% position as an active investor stake, rather than a holding represented as passive.
The refiling puts Musk’s disclosure history in clearer tension with the SEC’s later inquiry into whether he was accurately characterized as a passive investor.
Second-order effects
Twitter’s board and other shareholders face greater pressure to respond to a largest shareholder whose filing now signals an active role, rather than simply price exposure.
The SEC gains a more defined sequence of filings to examine alongside Musk’s March purchases and the timing of his ownership disclosure.
Third-order effects
The episode underscores how the passive-versus-active classification can become a consequential governance and enforcement issue when a large shareholder accumulates stock before public disclosure.
If regulators continue to test these classifications, prominent investors may face closer scrutiny of whether their filings match their conduct as their stakes grow.
The trend: Large, rapidly accumulated shareholder positions are drawing greater attention to the boundary between passive ownership, corporate influence, and disclosure compliance.
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. Welcome Elon!
I'm really happy Elon is joining the Twitter board! He cares deeply about our world and Twitter's role in it. Parag and Elon both lead with their hearts, and they will be an incredible team. https://twitter.com/...
You're supposed to file form 13D, which discloses the purpose of your large purchase, if you're an activist investor or joining the board. The shorter form Musk filed, 13G, is for when you acquire a bunch of stock but there's no reason other investors need to know what's afoot. h…
Musk's 13G, if I'm reading it right, omits the generally required certification about not influencing the control of the issuer (it's marked “not applicable") so it's possible his securities lawyers think they've found a clever loophole that lets him use the short form.
Two months ago Elon Musk tweeted a meme showing a picture of Hitler with the words “Stop comparing me to Justin Trudeau.” Today, he joins the company's board.
The chilling effect on journalism on Twitter will be severe. Musk is known to directly target his critics, including swatting one of his earliest vocal critics. Twitter will not ban him as a board member the next time he attacks a journalist.
Musk reached out to us before he polled his followers about Twitter's commitment to free speech. He wanted to confirm that we had, in fact, been suspended. He even mused on that call that he might need to buy Twitter. Now he's the largest shareholder and has a seat on the board.
The rest of Twitter's board must be thrilled with this development. LOL. I am surprised Musk accepted the offer. As I wrote in this week's @InsideOrchard essay, Musk doesn't strike me as someone who is into boards of directors. I can see him getting bored. https://insideorchard.c…
Just to make it abundantly clear, here's the standard certification you usually see at the end of the short form — from a randomly picked 2013 filing — and how it appears on Musk's filing. https://twitter.com/...
Unlike $TSLA, $TWTR has a Chief Legal Officer with tenure. Why would you add a BOD member who may have just embroiled you in (fresh) SEC issues? I predict the 13g becomes a 13d. As I understand it one has 10 days to amend.
Elon has changed his filing status from 13G to 13D. 13G has less reporting requirements provided one of several exceptions are met. Now that @elonmusk is 13D more data has been reported. Here are his $TWTR transactions. https://twitter.com/...
I believe the exemption he used to avoid reporting until now was that he was simply a passive investor and did not intend to influence the board or management. now that he is on the board, that exemption doesn't really hold any longer
Here's the 13G form Musk filed yesterday, April 4: https://www.sec.gov/... The same day—we learned from a company filing this morning—he finalized this letter agreement to join the board. https://twitter.com/...
what 13G is really for is like a stock broker who gathers a bunch of one company's stock without intending to mess with it; 13G also lets you wait a long time to file. This 👇 is obv the sort of direct influence that 13D is for; and it's supposed to be disclosed within 10 days. ht…
Just disclosed! @elonmusk's average $TWTR cost basis is $36.18. Up 41% through today on $2.64 billion cost = $1.07 billion profit.👍 His first purchase was Jan 31. Bought basically every day through April 1. Was WAVING IT IN the last few weeks of March.💰 His 13G is now a 13D. http…