WEBVTT - Musk's Hostile Takeover and Rivian's Production Woes 0:00:02.279 --> 0:00:05.600 From the heart of where innovation, money and power collive 0:00:06.360 --> 0:00:10.920 in Silicon Valley and beyond. This is Bloomberg Technology with 0:00:10.960 --> 0:00:27.320 Emily jay I'm Emily Jang in San Francisco, and this 0:00:27.400 --> 0:00:30.240 is Bloomberg Technology. Coming up in the next hour, Twitter's 0:00:30.280 --> 0:00:34.080 board mounts a poison pill defense against Elon Musk, while 0:00:34.159 --> 0:00:38.200 Musk continues to chaunt them, pointing out that without Jack Dorsey, 0:00:38.240 --> 0:00:42.200 Twitter's board members collectively own almost no shares and if 0:00:42.200 --> 0:00:45.279 his bid succeeds, they won't get a salary. Will have 0:00:45.320 --> 0:00:49.520 all the details as he hints at a hostile takeover. Plus, 0:00:49.520 --> 0:00:52.199 we'll get an inside look at Rivan's factory in Illinois 0:00:52.280 --> 0:00:54.360 and see how the ev maker is trying to combat 0:00:54.360 --> 0:00:57.920 the chip crisis. Later this hour, and it's expected to 0:00:57.960 --> 0:01:01.560 be the busiest wedding season in decades, we'll chat with 0:01:01.600 --> 0:01:04.320 the CEO of Rent the Runway about how all those 0:01:04.360 --> 0:01:09.319 IDUs could mean big business for the fashion platform. Now 0:01:09.400 --> 0:01:11.880 to our top story over the weekend, he sent just 0:01:11.959 --> 0:01:15.640 a tweet with three words love me tender. He could 0:01:15.640 --> 0:01:18.240 have been listening to the iconic Elvis Presley song, or 0:01:18.400 --> 0:01:21.280 could it be a cryptic reference to a potential tender 0:01:21.319 --> 0:01:24.760 offer to Twitter shareholders for control of the company. Friday, 0:01:24.760 --> 0:01:27.800 Twitter's board chose the poison pill defense, adopting a provision 0:01:27.800 --> 0:01:30.600 that would make it harder for Musk to acquire more 0:01:30.680 --> 0:01:35.119 shares and ultimately dilute his steak. Bloomberg's at Ludlow here 0:01:35.160 --> 0:01:36.959 to break it all down. At a lot going on here? 0:01:37.400 --> 0:01:40.000 What's the late twists and turns. It's interesting because the 0:01:40.080 --> 0:01:41.960 seven and a half percent game we saw on Twitter 0:01:42.000 --> 0:01:45.080 shares Monday is the biggest jumps in Tabril fourth, when 0:01:45.120 --> 0:01:48.480 Elon Musk's steak in Twitter was first disclosed. You remember 0:01:48.480 --> 0:01:52.920 it jump on that occasion. The broad psychology around this 0:01:53.040 --> 0:01:55.800 is that we're moving towards an outcome that would be 0:01:55.840 --> 0:01:58.080 more favorable for shareholders. See you talk about the poison 0:01:58.080 --> 0:02:01.960 pill defense. Twitter can issue you shares that investors can 0:02:02.000 --> 0:02:05.280 buy at a discount apart from Musk, anyone trying to 0:02:05.360 --> 0:02:08.760 acquire a state greater than fifteen percent in the company. 0:02:08.840 --> 0:02:11.040 Here's the thing coming me ins my Bloomberg terminal. This 0:02:11.120 --> 0:02:13.880 is the other side of the debate. We're trading at 0:02:13.960 --> 0:02:17.239 around forty five dollars a share. That's the blue line, 0:02:17.800 --> 0:02:19.919 or forty dollars to share I say that's the white line, 0:02:19.919 --> 0:02:21.880 the blue line is the average, and this twelve month 0:02:21.919 --> 0:02:25.120 price target, which is even lower, and that green dot 0:02:25.200 --> 0:02:26.880 on the right hand side of the screen is the 0:02:26.919 --> 0:02:29.840 fifty four dollars twenty cents per share offer that Musk 0:02:29.880 --> 0:02:32.520 currently has on the table, and the thinking is this 0:02:32.560 --> 0:02:35.400 could be lobal. Musk has been tweeting for three days 0:02:35.680 --> 0:02:38.440 about how Twitter's board has a duty to the shareholders 0:02:38.600 --> 0:02:41.840 to consider his bid a f juiciery duty. But the 0:02:41.840 --> 0:02:43.520 other side of that debate is they have a fiduciary 0:02:43.600 --> 0:02:46.359 duty to get the best possible offer for them. We're 0:02:46.440 --> 0:02:48.520 so far away from seventy three dollars a share, which 0:02:48.600 --> 0:02:50.480 is the fifty two week high on the stock, so 0:02:50.720 --> 0:02:54.679 some consideration. Final point two names top of the list 0:02:54.760 --> 0:02:58.320 for fidelity platform right now. Retail investors are buying into 0:02:58.400 --> 0:03:01.280 Tesla and Twitter, and it's in tressing because how many 0:03:01.280 --> 0:03:03.440 tweets has must send in the last few days. And 0:03:03.480 --> 0:03:05.200 some of the school to thow out there is that 0:03:05.400 --> 0:03:07.880 he's trying to get momentum behind a movement, just like 0:03:07.919 --> 0:03:11.760 he's on Tesla getting retail investors on board. Is he 0:03:11.760 --> 0:03:13.640 trying to get those retail investors on board with Twitter 0:03:13.680 --> 0:03:17.359 as well, and all right, thank you. The question now becomes, 0:03:17.440 --> 0:03:19.840 could Musk team up with someone else to make this 0:03:19.880 --> 0:03:23.800 Twitter dream a reality? Bloomberg Intelligence suggests Musk could partner 0:03:23.840 --> 0:03:26.960 with Oracle, for example, in a private equity consourtium that 0:03:27.000 --> 0:03:30.240 includes Toma Bravo to combat Twitter's poison pill, while raising 0:03:30.280 --> 0:03:34.480 the bid ten to fift to about fifty billion dollars. 0:03:34.600 --> 0:03:38.480 The Wall Street Journal is reporting Apollo Globals also considering 0:03:38.560 --> 0:03:42.800 joining in. Bloomberg's Max Chafkin joins us. Now, Max, if 0:03:42.800 --> 0:03:44.920 Ela Musk really wants to do this, what does he 0:03:45.000 --> 0:03:46.720 have to pull off? What does he have to pull 0:03:46.800 --> 0:03:51.640 together in this moment? Well, you have a couple of issues, 0:03:51.720 --> 0:03:54.280 one of which is that, you know, Elon Musk because 0:03:54.320 --> 0:03:57.560 this huge Twitter following, obviously he's able to move markets. 0:03:57.720 --> 0:03:59.680 On the other hand, in order to kind of pull 0:03:59.720 --> 0:04:02.640 together some sort of consortium, you're gonna have to convince 0:04:02.880 --> 0:04:05.200 a bunch of other rich guys, whether it's uh, you know, 0:04:05.320 --> 0:04:08.240 Larry Ellison or whoever, that they want to sign up 0:04:08.240 --> 0:04:11.000 for this wild ride. And pretty much, you know. One 0:04:11.040 --> 0:04:13.440 of the ways that Elon Musk has distinguished himself, of course, 0:04:13.520 --> 0:04:16.919 is by by being the most risk happy of anyone. 0:04:17.040 --> 0:04:19.719 So it's it's a little bit hard to imagine who 0:04:19.760 --> 0:04:22.440 comes together in that consortium and if they're really willing 0:04:22.480 --> 0:04:25.360 to go for it. Now, As someone who's interviewed Elon 0:04:25.440 --> 0:04:28.480 Musk many times over the last couple of decades, masks, 0:04:28.600 --> 0:04:31.880 what's your sense of how serious he is about this 0:04:32.000 --> 0:04:34.240 and marshaling the amount of capital that he would need 0:04:34.520 --> 0:04:37.640 to pull this off? And or do you think he's 0:04:37.680 --> 0:04:42.480 just messing with investors? Well? I think with Musk, you know, 0:04:42.760 --> 0:04:45.480 it's always a little bit of both. Right. If anyone 0:04:45.520 --> 0:04:48.040 watched this, uh, the interview that he did last week 0:04:48.080 --> 0:04:50.240 at the TED conference, you know, you saw that he 0:04:50.279 --> 0:04:53.120 hadn't really thought through a bunch of the kind of 0:04:53.160 --> 0:04:56.760 crucial aspects of what this transaction would be. On the 0:04:56.800 --> 0:05:00.360 other hand, Elon Musk is an incredible marketer. He somebody 0:05:00.360 --> 0:05:02.360 who likes to kind of go where the trends are 0:05:02.360 --> 0:05:04.880 pushing him. So you could sort of see a situation 0:05:04.920 --> 0:05:07.680 where he almost, I don't want to say accidentally, you know, 0:05:08.040 --> 0:05:10.680 winds up owning Twitter, but but where he kind of 0:05:10.720 --> 0:05:13.960 gets carried away by events. And I think, you know, 0:05:14.160 --> 0:05:16.719 if you're a Testlas shareholder, probably the best thing that 0:05:16.760 --> 0:05:19.440 could happen here would be for Musk to not be 0:05:19.480 --> 0:05:21.479 able to buy Twitter, but be able to have just 0:05:21.600 --> 0:05:24.719 a huge, you know, cultural, you know moment, and and 0:05:24.800 --> 0:05:28.040 not get blamed when the deal falls apart elon Musk 0:05:28.080 --> 0:05:32.239 potentially ending up owning Twitter by accident, that's an interesting thought. 0:05:32.279 --> 0:05:36.120 Bloomberg's Max Chafkin as always good to have you. Many 0:05:36.200 --> 0:05:40.360 questions remain about how exactly Musk wants to change Twitter 0:05:40.680 --> 0:05:42.800 if he acquires it, but he's made it clear he 0:05:42.880 --> 0:05:45.320 wants it to look it sound more like a free 0:05:45.360 --> 0:05:48.120 speech town square. Here's what he had to say during 0:05:48.120 --> 0:05:52.799 a Ted talk last week. I think it's very important 0:05:52.839 --> 0:05:59.320 for that would be an inclusive arena for free speech 0:06:00.040 --> 0:06:07.280 where well, yeah, so yeah, um, Twitter has become kind 0:06:07.279 --> 0:06:12.800 of the de facto town square. Um so uh. It's 0:06:12.839 --> 0:06:16.240 just really important that people have the both, uh, the 0:06:16.320 --> 0:06:20.599 reality and the perception, uh, that they are able to 0:06:20.680 --> 0:06:24.600 speak freely within the bounds of the low. To discuss, 0:06:24.680 --> 0:06:27.359 we're joined by Teddy Goff, co founder and partner at Precision, 0:06:27.440 --> 0:06:31.120 a leading strategy and marketing agency, also the former digital 0:06:31.160 --> 0:06:34.920 campaign manager for President Obama. So, Teddy, do you think 0:06:34.920 --> 0:06:36.560 this is a fight over free speech or is it 0:06:36.680 --> 0:06:41.560 something else. Well, I think it's largely a fight over power. 0:06:41.880 --> 0:06:45.360 What I mean by that is, you know, everybody understands 0:06:45.440 --> 0:06:47.719 this is not exactly a matter of free speech in 0:06:47.720 --> 0:06:50.080 the sense that nobody's being thrown into prison for anything 0:06:50.080 --> 0:06:52.400 that they tweet. You know. The important thing I think 0:06:52.440 --> 0:06:55.040 to keep in mind is Twitter and all the social 0:06:55.720 --> 0:07:01.320 platforms are driven by algorithms that determine the likelihood of 0:07:01.320 --> 0:07:03.320 of U seeing this or that post when you log in. 0:07:03.720 --> 0:07:07.800 And the question of who control who writes those algorithms, um, 0:07:07.839 --> 0:07:10.240 you know, is really consequential. So it's not a matter 0:07:10.280 --> 0:07:14.120 so much of um, you know, free speech. Most people 0:07:14.240 --> 0:07:16.600 have the right to tweet whatever it is that they want. 0:07:16.840 --> 0:07:19.760 It's a question of, um, you know, which which tweets 0:07:19.760 --> 0:07:22.120 and posts get out algorithmic promotion and wind up in 0:07:22.160 --> 0:07:23.960 the feeds of millions of people, and which one s don't. 0:07:24.160 --> 0:07:26.800 And I think the view of Musk and obviously this 0:07:26.840 --> 0:07:28.400 is sort of validated by the fact that Donald Trump 0:07:28.440 --> 0:07:30.880 got kicked off Twitter. That's sort of appointed supports his 0:07:30.960 --> 0:07:33.080 point is that these algorithms are written in a way 0:07:33.120 --> 0:07:36.240 that you know, sort of effectively censored conservatives, even those 0:07:36.280 --> 0:07:38.640 who aren't literally kicked off the platform feel that they 0:07:38.720 --> 0:07:40.840 are sort of shadow band or or that there's a 0:07:40.840 --> 0:07:44.480 thumb on the scale preventing their virality. And so I 0:07:44.480 --> 0:07:47.360 think the question how these things are written? Do we 0:07:47.360 --> 0:07:49.480 have transparency into the way these things are written? And 0:07:49.560 --> 0:07:52.840 ultimately you know which tweets you know go viral, which 0:07:52.840 --> 0:07:54.960 one s don't is hugely consequential, and I think that's 0:07:54.960 --> 0:07:58.560 what this is really about. There's also the question of 0:07:58.560 --> 0:08:02.320 whether a free speech to square can really exist on 0:08:02.360 --> 0:08:05.239 the Internet or anywhere. Reneed the rest of the Stanford 0:08:05.280 --> 0:08:10.160 Internet Observatory wrote in The Atlantic, the public square metaphor 0:08:10.200 --> 0:08:14.120 places wholly unrealistic expectations on what social media is or 0:08:14.200 --> 0:08:17.240 should be. It may simply be that when networks grow 0:08:17.280 --> 0:08:22.080 past a certain size, they become unmanageable. I mean, do 0:08:22.120 --> 0:08:27.520 you think Twitter has ever really been a public town square? Well, no, 0:08:27.800 --> 0:08:29.680 because of this reason of algorithms. You know, in a 0:08:29.680 --> 0:08:33.120 public down square, um, you can shout whatever it is 0:08:33.160 --> 0:08:35.000 you want to shout, and the people around you are 0:08:35.000 --> 0:08:37.080 going to hear it. On Twitter, the whole you know, 0:08:37.160 --> 0:08:39.600 mechanic of the of the platform, the whole idea of 0:08:39.600 --> 0:08:41.960 it is your tweet can go out to millions of 0:08:41.960 --> 0:08:44.600 people who didn't make the choice of following you, you know, 0:08:44.720 --> 0:08:47.840 just because um, you know, it gets it starts taking off, 0:08:47.880 --> 0:08:50.880 and then the algorithm boost situ into feeds all around 0:08:50.920 --> 0:08:54.280 the world. So it's really sort of fundamentally unlike a 0:08:54.360 --> 0:08:57.520 town um square, where you know, you're sort of um, 0:08:57.559 --> 0:08:59.160 your reach is sort of limited by the volume of 0:08:59.200 --> 0:09:01.560 your voice. UM. You know, that's obviously not the case 0:09:01.600 --> 0:09:04.480 on Twitter. I do agree that these these platforms have 0:09:04.600 --> 0:09:07.240 all become sort of ungovernable if you just look at 0:09:07.240 --> 0:09:10.560 the um, you know, the empirical reality. Both Democrats and 0:09:10.600 --> 0:09:13.199 Republicans are livid at Twitter. The Republicans are livid that 0:09:13.240 --> 0:09:16.319 Trump and some of his allies got booted. The Democrats 0:09:16.320 --> 0:09:18.560 think that Twitter is the reason Trump and some of 0:09:18.600 --> 0:09:21.360 his allies moved from the fringe to the political mainstream 0:09:21.360 --> 0:09:23.760 in the first place. The same debate obviously happens you know, 0:09:23.880 --> 0:09:27.840 arguably even more um caustically over Facebook. So you know, 0:09:27.920 --> 0:09:31.440 I I think that these platforms play a huge role 0:09:31.480 --> 0:09:34.840 in the discourse of the country. UM. Twitter especially to 0:09:34.880 --> 0:09:37.160 a weird degree, because even though it's smaller than Facebook 0:09:37.200 --> 0:09:40.360 by numbers, it has a disproportionate share of journalists spending 0:09:40.400 --> 0:09:43.080 all day there, and so things sort of make their 0:09:43.120 --> 0:09:46.240 way from Twitter into the nightly news and the local 0:09:46.240 --> 0:09:49.560 news and the daily papers all around the country. And um, 0:09:49.600 --> 0:09:52.440 it is obviously the case that these these questions are 0:09:52.760 --> 0:09:55.760 fundamentally political, and um, you know, the way that these 0:09:55.760 --> 0:09:59.640 platforms have have navigated these questions as obviously uh alienated 0:09:59.640 --> 0:10:03.280 both sides. So the question is, you know, should if 0:10:03.440 --> 0:10:07.800 if if, as you say, Twitter is ungovernable or maybe ungovernable, 0:10:07.920 --> 0:10:10.000 then then then what should happens? You know, it's a 0:10:10.040 --> 0:10:14.200 private company, is the Elon is Elon Musk the answer? 0:10:14.240 --> 0:10:16.760 And if if not Elon Musk, is it? Is it 0:10:16.800 --> 0:10:21.160 a public utility? Is it? Is it something else? Um, 0:10:21.280 --> 0:10:23.880 I personally think it's probably not Elon Musk. You know, 0:10:23.920 --> 0:10:27.120 there's been a lot of um, a lot of people 0:10:27.240 --> 0:10:29.559 mainly Elon Musk, you know, sort of allies and supportae 0:10:29.600 --> 0:10:31.120 of the past couple of days saying hey, look at 0:10:31.320 --> 0:10:34.240 for instance, Bloomberg, look at the Washington Post. The Washington 0:10:34.240 --> 0:10:36.480 Post was bought by Jeff Bezos. There's a really critical 0:10:36.480 --> 0:10:39.600 difference between the Bloomberg Washington Post model and we love 0:10:39.679 --> 0:10:43.560 what Elon Musk is proposing, you know, UM, Bloomberg and 0:10:43.559 --> 0:10:47.440 and bezos don't march into the editorial boards editorial board 0:10:47.520 --> 0:10:50.280 rooms at at at Bloomberg Media and at the Washington 0:10:50.360 --> 0:10:54.120 Post and demanded change in coverage. They pledge not to UM. 0:10:54.200 --> 0:10:56.280 Musk is sort of doing the opposite. He has essentially 0:10:56.280 --> 0:10:59.679 pledged to alter the way that information is shared. And 0:10:59.760 --> 0:11:03.040 this NATed on on Twitter. So there is a question 0:11:03.040 --> 0:11:05.559 of media consolidation. He's obviously not the first billionaire to 0:11:05.559 --> 0:11:08.360 get into the media ownership game, but he's the first 0:11:08.360 --> 0:11:10.560 at least in this you know, sort of cohort to 0:11:10.640 --> 0:11:14.200 do so with an express agenda behind that. And that 0:11:14.240 --> 0:11:18.200 agenda is not UM the sustainment of media or you know, 0:11:18.280 --> 0:11:21.680 public information. It's a it's got a political bent to it. 0:11:21.800 --> 0:11:24.800 So you know, whether Twitter and these other platforms ought 0:11:24.840 --> 0:11:28.000 to be UM regulated as public utilities or not UM 0:11:28.679 --> 0:11:33.280 I think, you know, to me, it's concerning that one individual, 0:11:33.400 --> 0:11:35.520 by the way, it could be a you know, you know, 0:11:35.600 --> 0:11:38.080 I'm a democratic, could be a Democrat want individual to 0:11:38.080 --> 0:11:40.800 take over one of these companies with an express purpose 0:11:40.960 --> 0:11:44.080 of UM changing the way that the group terms of 0:11:44.120 --> 0:11:47.560 service and the algorithm works. Which again is ultimately about 0:11:47.760 --> 0:11:50.880 who controls the discourse and are you know these sort 0:11:50.920 --> 0:11:55.880 of fringe uh physicians able to be disseminated in mainstream 0:11:55.920 --> 0:11:58.440 to millions and millions of people and what that does 0:11:58.480 --> 0:12:01.040 to our politics. So he's basically got an agenda in 0:12:01.080 --> 0:12:04.000 that sense. Um. I think his agenda is uh. It 0:12:04.080 --> 0:12:06.880 might be aligned with the economic incentives of the board 0:12:06.920 --> 0:12:09.080 of the shareholders, but it's probably aligned with the public 0:12:09.120 --> 0:12:13.280 did well. It remains to be seen exactly what his 0:12:13.400 --> 0:12:17.200 agenda is. Teddy Goff, co founder and partner at Precision Strategy, 0:12:17.240 --> 0:12:19.080 is always good to have you back here on the show. 0:12:19.520 --> 0:12:23.280 Coming up, Elon Musk hinting at a hospital. It's hostile takeover, 0:12:23.400 --> 0:12:25.440 but what will really happen. We're gonna have a conversation 0:12:25.440 --> 0:12:29.160 with Stanford professor Curtis mill helped about why this particular 0:12:29.160 --> 0:12:33.440 takeover attempt might matter more than the many others that 0:12:33.520 --> 0:12:51.440 have come before it. This is Bloomberg. Elon Musk set 0:12:51.600 --> 0:12:53.720 he made his best and final offer for Twitter last 0:12:53.720 --> 0:12:56.040 week at forty three billion dollars, but is now hinting 0:12:56.120 --> 0:12:58.720 at a hostile takeover that would involve a tender offer 0:12:58.840 --> 0:13:01.760 backed by other susters I want to bring in Curtis 0:13:01.760 --> 0:13:04.320 mill helped Stanford Law School professor and senior fellow for 0:13:04.320 --> 0:13:08.200 a broader view of this and talk about what's particularly 0:13:08.240 --> 0:13:12.680 notable about this potentially hostile takeover. Professor Millpop, thank you 0:13:12.760 --> 0:13:15.840 so much for joining us. You have studied hostele takeovers 0:13:15.880 --> 0:13:19.760 all over the world. What makes how this is evolving 0:13:19.840 --> 0:13:24.120 here different from what you've seen before? Well, I think 0:13:24.200 --> 0:13:27.640 in terms of the the actual offer itself there, this 0:13:27.720 --> 0:13:30.360 is so far playing out according to a standard playbook 0:13:30.360 --> 0:13:33.600 in the United States of an unsolicited bid for a 0:13:33.640 --> 0:13:38.400 public company followed by the target company's management adopting defensive 0:13:38.400 --> 0:13:41.560 measure of the poison pill. So so far, nothing so 0:13:41.559 --> 0:13:43.880 so special. But when you think about the company that 0:13:44.040 --> 0:13:47.040 is the target here, a social media company, I think 0:13:47.080 --> 0:13:49.360 this is quite unique and it really picks up on 0:13:49.400 --> 0:13:53.120 the conversation you are having with your previous guests about 0:13:53.640 --> 0:13:57.160 who gets to control public discourse in the form of 0:13:57.200 --> 0:14:00.000 these these platforms, and so I think that's very distinct 0:14:00.040 --> 0:14:04.120 of many social media companies and other tech companies have 0:14:04.160 --> 0:14:09.559 adopted dual class capitalization structures, meaning that the founders retained 0:14:09.600 --> 0:14:15.160 control of the enterprise by ownership of stock with super 0:14:15.240 --> 0:14:19.040 voting rights. Twitter did not do that, and now we're 0:14:19.040 --> 0:14:23.520 seeing one of the potential consequences of an unsolicited bid 0:14:23.600 --> 0:14:26.440 for the company. Switch raises a lot of very fascinating 0:14:26.480 --> 0:14:29.920 new new questions that we haven't seen before. It's interesting, 0:14:29.960 --> 0:14:34.240 given how criticized the dual class share structure has been 0:14:34.400 --> 0:14:37.920 at Facebook at Google in terms of potentially giving those 0:14:37.960 --> 0:14:42.479 founders too much power, how likely is it that Twitter's 0:14:42.480 --> 0:14:48.520 poison pill defense will actually work well? So the board 0:14:48.600 --> 0:14:51.960 is instituted the poison pill without shi Older approval, which 0:14:52.000 --> 0:14:54.760 is of course the beauty of the poison pill for 0:14:54.760 --> 0:14:59.000 for US managers. Unlike defensive measures in other parts to 0:14:59.000 --> 0:15:01.680 the world and the uk A in Europe or in Japan, 0:15:02.200 --> 0:15:05.640 where shareholders would have to approve the defensive measure, in 0:15:05.640 --> 0:15:08.840 the United States it's not required, but they will have 0:15:08.920 --> 0:15:13.440 to answer ultimately to the shareholders. They cannot simply sit 0:15:13.520 --> 0:15:16.680 behind the poison pill. They're going to have to justify 0:15:16.680 --> 0:15:20.800 why not letting elon must tender offer go forward is 0:15:20.840 --> 0:15:23.640 in the best interests of the corporation and it's UH 0:15:23.640 --> 0:15:27.320 and its shareholders. But I think that this may lend 0:15:27.360 --> 0:15:32.880 momentum to the movement toward adoption of dual class capitalization structures. 0:15:32.880 --> 0:15:36.640 There already is considerable momentum around this. Many of the 0:15:36.720 --> 0:15:39.200 I p o s in recent years have been founder 0:15:39.280 --> 0:15:43.160 control dual class UH structures. And I think that other 0:15:43.200 --> 0:15:46.520 founders out there who are coming through the through the 0:15:46.560 --> 0:15:49.080 pipeline are going to be looking at this and asking 0:15:49.120 --> 0:15:53.320 themselves whether they want to someday be faced with the 0:15:53.360 --> 0:15:56.960 situation that that the Twitter board is and probably concluding no, 0:15:57.200 --> 0:15:59.360 we we did not. So I think this is going 0:15:59.440 --> 0:16:02.520 to lend, you know, momentum to the controversy over dual 0:16:02.600 --> 0:16:06.040 class talk and the question whether is this actually in 0:16:06.080 --> 0:16:09.680 the best interests of society because these founders can be 0:16:10.080 --> 0:16:13.800 um insulated from short term market pressures, or does this 0:16:13.960 --> 0:16:18.320 just reinforce having a small number of extraordinarily wealthy people 0:16:18.840 --> 0:16:24.640 controlling these incredibly important and powerful platforms. We're looking at 0:16:24.720 --> 0:16:27.600 a graph here of the amount of followers that Musk 0:16:27.640 --> 0:16:31.680 has on Twitter, about a third of the daily active 0:16:31.760 --> 0:16:37.560 users on Twitter overall, a third a third of Twitter's 0:16:37.600 --> 0:16:40.080 daily active users. You know, how does that change the 0:16:40.120 --> 0:16:44.760 equation here quickly? Does that make this you know, UH 0:16:45.200 --> 0:16:50.760 more unfair or gosh, I don't know what the word is, 0:16:50.800 --> 0:16:55.840 but there's something different. Well, I think, just going back 0:16:55.920 --> 0:16:57.960 to the conversation you have with the previous guests, we 0:16:58.000 --> 0:17:01.280 have this anomalous situation which we live in a capitalist society. 0:17:01.360 --> 0:17:03.800 This is a pro for profit firm. The board of 0:17:03.840 --> 0:17:06.040 directors of Twitter is charged with doing what's in the 0:17:06.080 --> 0:17:09.080 best financial interests of the shareholders. And yet we have 0:17:09.119 --> 0:17:13.080 a corporation that is enormously powerful and influential in public 0:17:13.119 --> 0:17:17.879 discourse and in political discourse, uh specifically. So that's a 0:17:17.960 --> 0:17:21.840 very unique situation, and I think that the way this 0:17:21.840 --> 0:17:24.480 plays out is going to have ramifications in Washington, of 0:17:24.520 --> 0:17:28.719 course and elsewhere, because this is not just a garden dry, 0:17:28.800 --> 0:17:34.200 hostile takeover. Curtis Mill helped Stanford Law School professor, thank 0:17:34.200 --> 0:17:45.000 you so much for sharing your perspective with us. Today 0:17:45.359 --> 0:17:47.840 shares a riv and lower today, the electric vehicle maker 0:17:47.880 --> 0:17:50.800 has been hampered by the global chip crisis, but is 0:17:50.840 --> 0:17:54.200 trying to ramp out put Bloomberg's at Ludlow toward Rivan's 0:17:54.240 --> 0:17:59.399 factory in Illinois, with the company's CEO productions ramping up 0:17:59.440 --> 0:18:02.359 here in normal Illinois at Rivan three point three million 0:18:02.440 --> 0:18:05.520 square for e V factory. The company's building three different 0:18:05.560 --> 0:18:09.000 electric vehicles, and it's not easy going. Our biggest challenge 0:18:09.040 --> 0:18:12.359 today really resides around the supply chain. It's a small 0:18:12.400 --> 0:18:15.359 subset of the components in our vehicle, which we do 0:18:15.520 --> 0:18:19.080 have on a constrained basis, and it's limiting the overall 0:18:19.080 --> 0:18:21.720 output for production. A big part of the problem a 0:18:21.800 --> 0:18:24.760 lack of semiconductors. The plant is split up with two 0:18:24.760 --> 0:18:28.800 separate body lines and two separate general assembly lines. One 0:18:28.840 --> 0:18:32.280 fork is dedicated to consumer products. Rivan is focused on 0:18:32.320 --> 0:18:35.000 its battery electric pickup called our one T, but it's 0:18:35.040 --> 0:18:38.280 also working on small volumes of the R one S SUV. 0:18:39.040 --> 0:18:41.480 The other body in general assembly lines are building two 0:18:41.600 --> 0:18:44.280 versions of an electric delivery van for Amazon. But the 0:18:44.320 --> 0:18:47.640 ability to share the core technology backbone between those battery 0:18:47.680 --> 0:18:52.200 pack drive units, network architecture, e SU topology, the electronic stack, 0:18:52.240 --> 0:18:55.119 the perception stack really is what fueled the ability to 0:18:55.400 --> 0:18:57.800 go quickly. We got a behind the scenes look at 0:18:57.800 --> 0:19:02.480 the plant where workers were alongside hundreds of highly automated 0:19:02.560 --> 0:19:05.800 robotic arms. Sheet metal, steel and aluminum is brought in 0:19:05.920 --> 0:19:10.320 as coils. Massive industrial stamps generating huge force shape the 0:19:10.359 --> 0:19:13.840 metal into panels that fitness specific product. The body shop 0:19:14.040 --> 0:19:17.120 fuses all of the panels and structural parts together using 0:19:17.160 --> 0:19:20.120 advanced welding techniques. Then it's to a high tech paint 0:19:20.160 --> 0:19:23.560 shop where multiple coats are applied. Next, we're off to 0:19:23.640 --> 0:19:26.679 general assembly, where the top hat or body is married 0:19:26.720 --> 0:19:31.080 with the skateboard, which includes the motors, battery pack, and telematics. 0:19:31.240 --> 0:19:34.199 Moving along the line, everything from doors and windshields to 0:19:34.280 --> 0:19:37.840 the steering wheel and entertainment systems are added. After final 0:19:37.880 --> 0:19:40.320 tweaks and quality checks, it's off to the lot to 0:19:40.359 --> 0:19:43.119 await delivery. Rivim forecasts it will build twenty five th 0:19:43.560 --> 0:19:46.760 dvs this year across the two consumer models and ten 0:19:46.760 --> 0:19:49.200 thousand vans for Amazon. It built little more than t 0:19:50.119 --> 0:19:53.200 v s in Q one. Despite the challenges, the production 0:19:53.320 --> 0:19:59.120 rate is improving. It's incredibly exciting to see records being 0:19:59.160 --> 0:20:02.320 set in terms of the output or the production rate. 0:20:02.760 --> 0:20:05.119 Things said almost on a daily basis. To meet that 0:20:05.160 --> 0:20:08.720 demand long term, Rivian plans a second five billion dollar 0:20:08.760 --> 0:20:11.960 plant in Georgia and hopes lessons learned in Illinois will 0:20:12.000 --> 0:20:15.000 help it hit the ground running. Ed Ludlow Bloomberg News 0:20:15.119 --> 0:20:22.120 in normal Illinois are Ed Ludlow there well Gladet University 0:20:22.119 --> 0:20:24.840 an Educational Institution for the Deaf and Heart of Hearing 0:20:24.960 --> 0:20:28.480 is getting the commencement speech of its dreams. Apple CEO 0:20:28.560 --> 0:20:31.040 Tim Cook has agreed to deliver the speech after a 0:20:31.080 --> 0:20:34.159 student invited him via Twitter. In American sign language, he 0:20:34.240 --> 0:20:37.720 describes how blown away students across campus were by Apple's 0:20:37.720 --> 0:20:51.440 original movie Coda. Cook will speak at Gladet on Friday. 0:20:51.760 --> 0:20:54.280 Welcome back to Bloomberg Technology. I'm emily changing in San Francisco. 0:20:54.359 --> 0:20:57.560 Let's get back to our top story. Elon Musk trying 0:20:57.560 --> 0:21:00.399 to buy Twitter, the world's richest man. Twee in his 0:21:00.480 --> 0:21:04.000 latest salvo that if he successfully acquired Twitter, the board 0:21:04.080 --> 0:21:07.720 salary would be zero dollars. For more on the most 0:21:07.760 --> 0:21:10.959 recent twist and turns are at Ludlow back with us, 0:21:11.000 --> 0:21:13.919 and that's not all. Yeah, it's it's an interesting tweet 0:21:13.960 --> 0:21:16.520 to make. And he's been digging at this idea about 0:21:16.800 --> 0:21:20.639 fiduciary duty that Twitter's board has to present his offer 0:21:20.880 --> 0:21:23.239 to existing shareholders. By the way, we're looking again at 0:21:23.240 --> 0:21:25.359 that seven and a half cent gain on Monday, biggest 0:21:25.400 --> 0:21:29.200 jump since April four, when Mosques stake in Twitter the 0:21:29.240 --> 0:21:33.120 original state was first disclosed. And it's interesting because he's 0:21:33.160 --> 0:21:35.399 trying to make this about being the right thing in 0:21:35.440 --> 0:21:39.520 the interest of shareholders. And his additional point is the 0:21:39.640 --> 0:21:42.159 board in not passing on that offer a and not 0:21:42.200 --> 0:21:45.359 fulfilling their fiduciary duty. But also they don't have the 0:21:45.400 --> 0:21:50.040 same vested interest as shareholders. Why he keeps poking at 0:21:50.080 --> 0:21:52.119 the number of shares or the volume of shares that 0:21:52.160 --> 0:21:55.040 Twitter's board has. If you strip out Jack Dorsey, who 0:21:55.040 --> 0:21:57.680 steps down from the board anyway later this year's he's 0:21:57.720 --> 0:21:59.879 saying that they can't have economic interests the line with 0:22:00.000 --> 0:22:02.480 shareholders because they own a negligible amount of stock. And 0:22:02.600 --> 0:22:04.280 luckily for you have I had a few hours of 0:22:04.320 --> 0:22:08.440 free time today, so we crunch the numbers. Thank you, ed, 0:22:09.000 --> 0:22:11.560 And this is the point, right, These are negligible volumes 0:22:11.600 --> 0:22:14.280 of shares that each board member has. Most of the 0:22:14.280 --> 0:22:16.520 board members on Twitter's board are paid a salary for 0:22:16.600 --> 0:22:18.800 what is essentially a part time job. It ranges from 0:22:18.800 --> 0:22:21.360 say two hundred thousand, three hundred thousand dollars, and they 0:22:21.359 --> 0:22:24.639 have negligible amounts of shares. Even in the case, for example, 0:22:24.720 --> 0:22:28.560 let's pick out Omid Cordistani has four thousand shares, that's 0:22:28.600 --> 0:22:32.240 only zero point zero point zero point zero two of 0:22:32.320 --> 0:22:34.960 the flow, and so he keeps hammering home this idea, 0:22:35.080 --> 0:22:37.000 do what's in the best interest of shareholders, and his 0:22:37.080 --> 0:22:39.520 main argument appears to be because they don't hold that 0:22:39.600 --> 0:22:42.400 much stock on the board, they're not aligned with those interests, right, 0:22:42.480 --> 0:22:44.560