After scooping up a major stake in Twitter, activist investor Elliott Management Corporation plans to oust its co-founder and CEO Jack Dorsey, according to recent reports.
Sources familiar with the matter that requested anonymity told Bloomberg that the $40.2 billion hedge fund has nominated four directors to Twitter’s executive board, an ominous choice considering only three seats will open up at this year’s annual shareholders meeting in spring. Elliott aims to fill all three seats along with “any other vacancies that may arise,” per Bloomberg’s report. And apparently Dorsey is on the shortlist for the chopping block.
That’s thanks to significant pressure from the firm’s billionaire founder Paul Singer, as CNBC reported Friday. Sources told the outlet that Singer objects to him remaining head honcho while his attention’s divided between both Twitter and Square, the online payment company Dorsey also helms. Dorsey’s also recently floated the idea of moving to Africa, which could make running things a bit more complicated.
Presumably, Elliott’s decided that leveraging their equity stake to put their own guy in charge is much easier, especially since Dorsey only really owns about 2 percent of the company.
This lack of voting control has made the company a target for activist investors for years, and with Twitter recently reporting its first billion-dollar quarter in its history of rocky price struggle, the iron was hot. Elliot also has a history of throwing its stakeholder weight around to push for change, as it’s done at AT&T Inc., EBay Inc., Marathon Petroleum Corp., and Pernod Ricard SA, per Bloomberg’s report.
A Twitter spokesperson declined to comment on the matter in an email to Gizmodo.
