Elon Musk defends Twitter CEO Jack Dorsey as Elliott seeks to oust him

Elon Musk speaks onstage through the E3 convention in Los Angeles on June 13, 2019.

Charley Gallay | Getty Images

Elon Musk jumped to the protection of fellow tech billionaire Jack Dorsey late Monday, because the latter faces stress from an activist investor to step down because the CEO of Twitter.

“Just want (to) say that I support @Jack as Twitter CEO,” Musk, the chief of Tesla and SpaceX, mentioned in a tweet. He added that he thinks Dorsey has coronary heart, utilizing the guts emoji.

Musk’s feedback arrive after Paul Singer, the billionaire founding father of hedge fund Elliott Management, constructed a stake within the microblogging platform in a bid to push for modifications — together with the elimination of its boss.

CNBC has learned Elliott has a greater than $1 billion stake in Twitter and has nominated 4 new board members. The firm is thought to usually purchase shares in massive firms to have a say on points like governance and technique.

For instance, Singer’s activist fund recently bought into SoftBank, the Japanese tech investing juggernaut, looking for to have it repurchase as much as $20 billion in inventory and enhance its governance practices. That was after the failed preliminary public providing of WeWork and amid basic worries over SoftBank’s bets on closely lossmaking tech firms.

In Twitter’s case, Singer is concerned by Dorsey splitting his time between operating each Twitter and his monetary know-how agency Square. Dorsey’s need to maneuver quickly to Africa — which has already divided opinion amongst analysts — is one other situation at hand in Elliott’s goal to oust him.

Twitter shares rose almost 8% on Monday as buyers reacted to information of Elliott’s stake within the firm. The rally added greater than $2 billion to Twitter’s market capitalization, lifting it to $28 billion.

In its most up-to-date quarterly earnings, Twitter reported its biggest-ever quarterly progress in customers, however missed analysts’ revenue expectations.

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