Elon Musk ditches plan to join Twitter board despite offer from CEO Parag Agrawal

Elon Musk
There is speculation this could lead to Musk buying a controlling interest. Photo credit: Getty Images

Twitter's biggest shareholder Elon Musk has decided not to join the social media platform's board after all, according to CEO Parag Agrawal.

This has caused open speculation about the controversial billionaire buying a controlling interest, or even simply "failed the background check".

According to Agrawal, Musk made the decision two days ago, meaning his latest tweets asking users about Twitter functionality were made after his decision.

"The board and I had many discussions about Elon joining the board, and with Elon directly," Agrawal wrote in a statement.

"We were excited to collaborate and clear about the risks. We also believed that having Elon as a fiduciary of the company where he, like all board members, has to act in the best interests of the company and all our shareholders, was the best path forward."

On that basis, the board offered him a seat, Agrawal wrote.

"We announced on Tuesday that Elon would be appointed to the board contingent on a background check and formal acceptance," he continued.

"Elon's appointment to the board was to become officially effective 9 April, but Elon shared that same morning that he will no longer be joining the board. I believe this is for the best.

"We have and will always value input from our shareholders whether they are on our Board or not. Elon is our biggest shareholder and we will remain open to his input."

If Musk had taken a seat on the board, he would have been limited to a 14.9 percent stake in the company.

However, without that position, Musk isn't limited in the number of shares or percentage he can own, leading some to speculate that the billionaire's decision could be related to a desire to take full control.

"Not taking the board seat relieves Elon Musk of the commitment not to buy more than 14.9% of the company, right? So he's free to try an activist takeover? Is that the plan?," journalist Bill Murphy tweeted.

"Or, he refused his seat so he is no longer bound to the restriction of how many shares he can buy, meaning his intent could be to take a bigger stake in the company following his 90 days on the agreement; he can only remove the cap if he is not on the board," wrote a second.

Others took Agrawal's words to mean Musk may not have qualified to sit on the board

"Isn't the implication that he failed the background check?," one wrote.

"So basically he refused to join the board so that he could continue to talk shit about Twitter without get sued," another suggested.

The Tesla CEO owns 9.2 percent of the company after purchasing US$2.64 billion worth of shares between January and April.

In the last two days Musk has shared his views on how Twitter Blue, the platform's subscription model, should be reformed, along with a suggestion its headquarters could be converted to a homeless shelter.