Elliott Management Corp, an American investment management firm has disclosed plans to push for changes on Twitter’s board following the sizeable stake it has in Twitter Inc.
Elliott Management Corp has reportedly pushed for the replacement of the Chief Executive Officer, Jack Dorsey while nominating four new directors to come on Twitter’s board.
Although the exact stake of Eliott in Twitter is yet to be disclosed or determined, reports have it that Eliott is trying as much as possible to nominates directors to fill in the only three vacant seats at this year’s annual meeting.
Why this matters: This push by Eliott is coming at a crucial time when major events or issues are coming into play like the U.S elections and the spread of the Coronavirus, which seems to attract more users and advertisers to Twitter.
Twitter has also been slacking on its efforts at improving the app for its users in recent times. While it chooses to focus more on its core service, other social media competitors like Snap Inc. and Instagram develop filters and stories popular with their users.
What you should know: For years, Twitter has been seen as a target for activist investors like Eliott. This is due to the fact that the company only has one class of stock. This means co-founder, Dorsey doesn’t have voting control of the company like Facebook Inc.’s Mark Zuckerberg or Snap co-founders, Evan Spiegel and Bobby Murphy.
Eliott is also not the only firm to have had issues with the governance at Twitter. An investor in Twitter, Scott Galloway, a professor of marketing at New York University’s Stern School of Business had written a letter to the company’s executive chairman, Omid Kordestani, sharing his concerns last year.
Meanwhile, Elliott has a long history of agitating for changes at some of the world’s largest companies. Last month, the firm disclosed a stake in Japan’s SoftBank Corp and said it planned to push for a larger share buyback and governance changes at the firm’s Vision Fund.