Elliott Management founder seeks to remove Twitter CEO

Wednesday, 04 Mar, 2020

When Elliott Management, a NY investment firm with an activist approach, sets its sights on a company, it usually means it has been under-performing, and it sees a ton of unmet potential.

Elliott is said to take issue with Dorsey's perceived split loyalties as CEO of Twitter and another company he founded and runs called Square, which works in mobile payments.

However, the spokespersons for Elliott and Twitter declined to comment on the story. At the end of past year, Scott Galloway, marketing professor at the Stern School of Business at New York University, already expressed the necessary criticism of the company and the CEO. In Elliott Management's corner was the New York-based hedge fund's head of USA activism, Jesse Cohn, and portfolio manager Marc Steinberg, they said.

Early in 2019, the hedge fund won a board seat at eBay.

An activist investor known as a major Republican political supporter wants to wrest control of Twitter from co-founder and CEO Jack Dorsey, US media has reported. Despite its popularity, the company remains only a fraction of the size of rival social media giants, reporting only modest annual growth rates.

Despite his plans to spend part of the year living in Africa, Dorsey said he won't be hampered by his travel.

Twitter has only one class of stock.

With pressure from Elliot Management, Dorsey might have to leave the role of CEO in the company he founded yet again.

Sources say that Dorsey has too many side projects, particularly Square, but also his growing interest in crypto currency and Africa, and that Twitter requires a full-time, focused chief executive.

Since the return of Dorsey to the leading position in Twitter in 2015, the company's shares have dropped slightly over six percent.

Elliott's campaign isn't the first time Dorsey's role has come under fire. Galloway said at the time that he owned about 334,000 Twitter shares.

Dorsey is the only CEO of two companies with market valuation of more than $5 billion.

Elliott's exact stake couldn't be determined.