Jack Dorsey is contributing his share to Elon Musk’s Twitter
Jack Dorsey has contributed his entire stake in Twitter stock, valued at nearly $1 billion, to the private company he founded, now controlled by Elon Musk, at a purchase price of $54.20.
Regulatory filings show that Dorsey, who was Twitter’s chief executive until late last year, has contributed about 18 million shares to the private company, making him one of its largest shareholders.
The news comes as Musk has moved quickly to put his stamp on the platform. Firing top executives including Dorsey’s successor, Parag Agrawal, planning for broader layoffs and order a renew of the verification process.
A filing filed Monday confirmed Musk, who changed his public profile to “Chief Twit,” is the current chief executive of Twitter. It’s unclear if he’ll pick someone to fill the role in his place, but he’s being backed by a group of loyal lieutenants, including venture capitalist David Sacks and his personal attorney Alex Spiro, as he evaluates Twitter’s business.
Musk and Dorsey have long admired each other in a “bromance,” which played a significant role in shaping the Tesla CEO’s bid to buy the company.
In private messages revealed in court filings, Dorsey encouraged Musk to buy the platform, writing that it should always have been a “foundation-funded open-source protocol” and not a company. “That was the original sin,” he said.
Dorsey also said he previously tried to bring Musk onto Twitter’s board of directors, but the directors declined because they were too “risk-averse” and called her “terrible.”
After the board approved the acquisition, Dorsey publicly tweeted, “Elon is the unique solution I trust. I trust his mission to expand the light of consciousness.” Dorsey left the Twitter board in May, just weeks after the company announced it would sell it to Musk for $44 billion.
According to the filing, Dorsey and Musk “can be considered a group for purposes of part of the filing,” a designation that indicates the pair worked together on the acquisition.
Dorsey, however, “declines[ed] the existence of such a group and also rejects beneficial ownership of common stock that is beneficially owned [Musk]”, says the file.
The plunge in stock prices of Twitter rivals Snap and Meta Platforms this year likely means the value of shares held by rollover investors — including Musk, who is contributing his former 9% stake in Twitter to the new private company — is way below the transaction price of $54.20 per share.
Dorsey is co-founder of financial technology company Block, where he serves as chief executive. His stake in Block, formerly known as Square, is worth billions of dollars.
Separately, a securities filing over the weekend showed Prince Alwaleed bin Talal bin Abdulaziz of Saudi Arabia had contributed 35 million shares, or 3.5 percent of public Twitter’s total shares, to the new private company.
The position came under scrutiny from US politicians, including Chris Murphy, a US Senator from Connecticut, who expressed unease about the media company’s foreign ownership and called for an investigation into the national security implications.
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