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One extremely wealthy man quietly held shares in an undervalued company. This investor went public about his concerns regarding the firm and asked for clarifications.

We’ve seen where such a scenario ends dozens of times over the past decades: The rich shareholder is perfectly positioned to initiate a hostile takeover of a company. And now that’s the reality confronting Twitter after Elon Musk has decided not to take a board seat, a role for him announced with some fanfare last week by CEO Parag Agrawal and founder Jack Dorsey. A day earlier, Musk, the world’s richest person, revealed he’d amassed a 9.2% stake in the company, making him its largest shareholder.

“This now goes from a Cinderella story with Musk joining the Twitter board to likely a Game of Thrones battle between Musk and Twitter,” says Dan Ives, a Wedbush analyst who covers Tesla, one of two companies Musk runs. (SpaceX, the other.

Was it a coincidence? Musk posted a few suggestions on Twitter over the weekend to change Twitter. Musk suggests Twitter could change nascent plansTwitter Blue is a subscription service that allows users to follow the company. seemed to advocate for eliminating ads, which account for nearly all of Twitter’s $3.7 billion in annual revenue. Further, Musk threw out ideas for Twitter’s headquarters Convert the property to a shelter for homeless people and make it even more attractive. the company name (drop the “w” to form a crude joke). Musk speaks to a large audience. He is followed by over 81,000,000 people via Twitter. This makes him one of the most watched figures on the platform.

Most striking was Musk’s Saturday tweet asking the question, “Is Twitter dying?” It was Musk pointing out that some of Twitter’s most followed accounts rarely publish content, drawing attention to limited activity from accounts run by celebrities such as Rihanna, Justin Bieber and Taylor Swift.

Musk’s tweet storm further unnerved Twitter employees, who already ended the week worried what effects his disruptive presence could have on the board. His tweet about Twitter and the inactive but widely followed accounts drew swift condemnation from God-Is Rivera, the company’s global director of culture and community.

“As a frequent tweeter you should know that follower count isn’t always king,” she wrote in a tweet replying to Musk’s original. “People who push conversations forward, build equity within communities, & offer unique perspectives are what make this app vibrant.”

Agrawal & Dorsey were quick to adopt Musk. They praised him on Twitter, and announced his new board seat one day after Musk. When Elliott Management acquired a share in Twitter in 2019, it tried to replicate the strategy. But the plan didn’t seem like it would work as well with an investor like Musk, who has channeled a chaotic management style while running Tesla and SpaceX—often using Twitter to publish controversial statements about those companies’ plans.

The agreement that would’ve put Musk on the board included a stipulation: Musk couldn’t accumulate more than 14.9% of the company. Since he’s not joining the board, he can buy up as much stock as he can. Much of his fortune is in Tesla shares, so if he wanted to launch a takeover bid, he’d likely want to team up with a private equity firm or some other financier.

Twitter doesn’t have the dual-share classes that many public tech companies (Meta, Alphabet, Snap) do. Those systems leave voting rights—control—with a company’s founders, protecting them against a Musk. Without this Twitter could adopt a so-called poison pill plan, a costly move where it sells stock at a discount to dilute an aggressive shareholder’s stake. Kohl’s and Papa John’s have both adopted such plans over the last couple years to ward off encroaching investors.

Twitter shares fell 3.7% Monday morning in pre-market trades. The stock was hit by concerns in recent months that the company will not meet Dorsey’s goals to increase users and revenue by next year. Between October and March 2013, the stock fell nearly half its worth.

Long-standing challenges have been faced by the company in balancing its culture and its business success. The company was established in 2006. It went public almost seven years later. Within a few months of the IPO, its share price had reached $70 per share. But shares languished after that and didn’t climb above $70 until the pandemic when Twitter and other internet companies saw a surge in users during lockdowns.

Corporate raiders see the opportunity to purchase stock at cheap prices, make improvements and then sell the company for profit. You should remember that Elliott bought up shares in 2019. He then won several concessions from Twitter management. These included more ambitious growth goals and a plan of success for Dorsey. In November Dorsey resigned from Twitter and handed the job of CEO to Agrawal.

Musk’s arrival last week buoyed the stock significantly, and even after the pre-market selloff, the shares are up nearly 20% since he unveiled his shareholding. Musk will have to pay more if he decides to move. Game of Thrones Follow us on Twitter.