Twitter on Friday unveiled its counterattack against Elon Musk by putting in place a corporate manoeuvre known as a poison pill.

The strategy aims to slow or block Musk’s $43 billion bid to buy Twitter.

A poison pill, devised by law firms in the 1980s to protect companies from corporate raiders, essentially lets a takeover target flood the market with new shares or allow existing shareholders other than the bidder to buy them at a discount. That means anyone trying to acquire the company must negotiate directly with the board.

The pill will be triggered once any individual or a group of people working together buy 15 per cent or more of Twitter’s shares. Musk currently owns more than 9 percent.

Twitter said the plan will be in place until April 14 of next year, adding that it would not stop the company from holding talks about a sale with any potential buyer. It said the mechanism would give it more time to negotiate a deal.

On Thursday, Musk announced his intention to acquire the social media service, a purchase that he believed would allow him to roll back Twitter’s moderation policies.

The billionaire’s offer could be worth more than $40 billion and have far-reaching consequences on the social media company.

Twitter attempted to wrangle the world’s wealthiest man in recent weeks as he snapped up its shares. Last week, Twitter offered Musk a board seat, but he soured on the arrangement when it became clear that he would no longer be able to freely criticise the company. He rejected the role on Saturday and informed Twitter on Wednesday evening of his acquisition plans. The poison pill manoeuvre is Twitter’s latest strategy to box out the billionaire.

Twitter said in a statement that its plan “is similar to other plans adopted by publicly held companies in comparable circumstances”.

Companies are often wary of using poison pills because they limit shareholders’ rights. Still, some critics, like Institutional Shareholder Services, an influential advisory group, have indicated that they are open to the tactic in certain circumstances. NYTNS