Jack Dorsey‘s reign as Twitter‘s CEO will continue, thanks to a new billion-dollar deal signed by the social media giant and two major investment firms.
The move will see tech-focused fund Silver Lake invest $1 billion in Twitter directly, while Elliott Management enters a “co-operation agreement” with Twitter to be disclosed at a later date.
Twitter will then use that money as part of a $2 billion share repurchase scheme, according to the related press release. Execs from both Silver Lake and Elliott Management will also be awarded seats on Twitter‘s board of directors.
Last week, Hard Fork reported that Paul Singer, the billionaire founder and CEO of Elliott Management, had been pushing to oust Twitter‘s founder. The fund had recently acquired a 4% stake in Twitter.
Singer had voiced concern over whether Dorsey’s other company, the fintech startup Square, was detracting from his ability to effectively lead Twitter.
Shortly after, Dorsey announced he no longer intended to move to Africa for six months in 2021, citing coronavirus anxiety. He’d originally tweeted those plans after visiting local fintech startups.
Elliott is now deep in Twitter — but how deep exactly?
Included in Twitter‘s press release is a rather curious section that serves as a disclaimer, promising that neither Elliott nor Silver Lake will comment on or attempt to influence Twitter in any way when it comes to its policies or rules.
“Elliott and Silver Lake further commit to, and emphasize the importance of, maintaining the independence and impartiality of the Twitter platform and its rules and enforcement,” it reads.
This makes sense after noting that Singer, a staunch Republican, is a controversial figure in finance. His firm is the world’s largest activist hedge fund, with a general strategy of making large investments in what it perceives as struggling companies, using that sway to force business decisions.
But Elliott Management is widely referred to as a “vulture fund,” as it specializes in purchasing sovereign debt of struggling nations, acting as a “rogue creditor.”
This has often resulted in Elliott Management buying defaulted debt of countries like Peru and Venezuela, later suing them when they can’t pay. This led the former president of Argentina to reportedly call Singer a “vulture lord,” and a “financial terrorist.” The fund‘s activity in the Congo has however been credited with exposing government corruption.
So while Dorsey keeps his job, the big question is what exactly is in that co-operation agreement between Elliott Management and Twitter — details that will only come to light once the related documents have been filed with the SEC.