Twitter's board detailed its poison-pill defense against Elon Musk and 'unfair takeover tactics'

• Twitter's board has detailed its poison-pill defense against Elon Musk's takeover bid.
• The firm will give other shareholders a chance to buy a portion of Twitter's preferred stock for $210.

The battle for Twitter is heating up.

On Monday, the company's board detailed its "poison pill" defense to thwart Tesla CEO Elon Musk's takeover bid. It comes as more investors are reportedly thinking about putting in buyout offers for Twitter.

Twitter's board detailed its strategy in a Securities and Exchange Commission filing on Monday.

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The "poison pill," or a shareholder rights plan, will be triggered if Musk, or any other investor, expands their stake in Twitter to 15% without the board's approval. Musk currently owns about 9% and is the firm's largest individual shareholder. Investment firm Vanguard has the largest overall stake in Twitter at 10.29%.

When activated, the plan will allow all other shareholders as of April 25 to exercise the rights to buy a portion of Twitter's shares for a discount at $210. The effect would be to dilute Musk's stake.

This plan, set to expire in a year, should act as a "significant penalty" on any potential investor looking to increase their stake, and should "protect stockholders from coercive or otherwise unfair takeover tactics," the board said in the filing.

While Twitter hasn't officially rejected Musk's bid, it's open to talking to other parties or to negotiating competing buyout offers if it "believes that it is in the best interests of Twitter and its shareholders," it said in Monday's filing.

Since the board first shared its intention last week to introduce a "poison pill" plan, Musk has been criticizing Twitter's board members, saying their "economic interests" are "simply not aligned with shareholders." He said board members, who receive a collective $3 million in cash and stock awards, won't receive a salary if he succeeds in his takeover bid.

At $54.20 a share, Musk's offer to buy Twitter outright, which he called a "best and final" offer, would value the deal at $43 billion.

While Musk didn't reveal how he would be financing the deal, he claimed on April 15 that he has sufficient assets to fund the buyout. Investment bank Morgan Stanley could offer him some form of debt financing, while some unnamed investors have approached Musk to participate in his offer, The Wall Street Journal reported last week.

Other private equity investors such as Apollo Global Management and Thoma Bravo have also expressed interest in participating in a bid for Twitter, reports say.

Unnamed sources told Reuters and the Wall Street Journal that Apollo is discussing whether it should back Musk's bid for Twitter, or support other potential bidders with debt or equity.

And Thoma Bravo reportedly approached Twitter to say that it's considering putting together a bid that would rival Musk's to buyout the company, according to Reuters. There were no details on the price of the deal, or whether Thoma Bravo will put in an official offer.