Activist Elliott builds Twitter stake as it plots ousting of Jack Dorsey
Activist investor Elliott Management has built up a stake in Twitter in a bid to oust the social media site’s founder Jack Dorsey as chief executive.
The New York-based hedge fund, founded by billionaire Paul Singer, has nominated four directors to Twitter’s board, Bloomberg reported.
Elliott is also said to be plotting the removal of Dorsey, to be replaced by a more dedicated chief executive.
Dorsey has come under scrutiny for his dual role as chief executive of Square, the payments company he co-founded in 2010.
It is not clear exactly how large Elliott’s stake is, nor who it has nominated to the board. Twitter declined to comment. Elliott has been contacted for comment.
Dorsey, who holds a two per cent stake in Twitter, returned to Twitter in 2015 after boss Dick Costolo stepped down. He is one of the only people to run two public companies at the same time.
Shares in the social media platform slumped by a fifth in the third quarter after it missed expectations for both profit and revenue due to bugs in its advertising technology.
But the company last month bounced back, posting more than $1bn (£780m) in quarterly revenue for the first time.
Dorsey has been vocal about his company’s efforts to crack down on online abuse amid growing scrutiny from regulators.
The firm has trialled a new feature allowing users to block replies, while it has also rolled out political ad bans, setting it apart from rival Facebook.
However, Dorsey raised eyebrows last year when he announced plans to spend as long as six months in Africa in 2020.
It comes at a key time for the company, which plans to grow headcount by 20 per cent or more this year and is gearing up for major events such as the Tokyo Olympics and US presidential election.
Elliott has a track record of clashing with some of the world’s largest companies. Last month the hedge fund revealed a three per cent stake — worth $2.5bn — in Japanese giant Softbank, where it is urging changes at the ailing $100bn Vision Fund.
Shares in Twitter were up almost eight per cent in post-close trading.