Twitter adds Elon Musk to its board of directors.

Elon Musk is becoming a member of the board of Twitter.

The corporate disclosed the information in a securities submitting on Tuesday, sooner or later after Mr. Musk revealed that he had purchased a 9.2 p.c stake within the social media large, a purchase order that appeared to make him its largest shareholder. The information despatched Twitter’s shares skyrocketing greater than 20 p.c on Monday.

Twitter’s inventory rose greater than 6 p.c in premarket buying and selling on Tuesday after the information of Mr. Musk’s board appointment.

Mr. Musk had been quiet on his intentions for the acquisition, which was price about $2.9 billion earlier than it was disclosed however has risen sharply in worth since. He registered with a securities doc referred to as a 13G submitting, indicating that he deliberate for the funding to be passive and that he didn’t intend to pursue a bigger function within the firm.

Twitter’s Tuesday announcement stated that there have been no “preparations or understandings” between Mr. Musk and Twitter that led to his director function.

“It’s theoretically potential” to have a passive stake in an organization and be part of the board in a “passive monitoring capability,” stated Joshua Mitt, a professor of company legislation at Columbia Regulation College. However the presumption of buying a board seat could be to successfully have an effect on change within the firm, he stated. “It doesn’t imply that you simply couldn’t attempt to persuade the S.E.C. in any other case, however I believe it could be an uphill battle,” Mr. Mitt stated.

Mr. Musk is ready to be appointed to a board seat that expires in 2024. For so long as he’s serving on the on the Twitter board, and for 90 days after if he selected to step down, he wouldn’t be allowed to personal greater than 14.9 p.c of Twitter’s inventory, both individually or as a member of a gaggle.

Jack Dorsey, Twitter’s co-founder, stepped down as its chief government in November and plans to go away the corporate’s board when his time period ends subsequent month.

“By means of conversations with Elon in latest weeks, it turned clear to us that he would carry nice worth to our Board,” Twitter’s chief government, Parag Agrawal, tweeted on Tuesday.

The submitting detailing Mr. Musk’s funding in Twitter was dated March 14, which is the day he crossed the 5 p.c threshold that required the disclosure. However he may have been shopping for up shares lengthy earlier than then.

“Trying ahead to working with Parag & Twitter board to make important enhancements to Twitter in coming month,” Mr. Musk tweeted in reply.

Mr. Musk has criticized the corporate in latest weeks for failing in his view to stick to free speech rules, and he has argued that customers needs to be allowed to decide on the algorithms that choose the tweets they see or construct their very own, as an alternative of counting on Twitter to curate posts.

The thought was one Mr. Dorsey championed whereas main Twitter. “The selection of which algorithm to make use of (or not) needs to be open to everybody,” he stated final month in response to a tweet from Mr. Musk pushing for open-source algorithms.

On Monday, Mr. Musk posted a Twitter ballot asking customers whether or not they needed a protracted sought-after functionality to edit tweets, maybe a touch that he needed to affect options supplied by the corporate.

“Would you like an edit button?” Mr. Musk requested. Mr. Agrawal responded to his tweet with an obvious reference to an earlier post from Mr. Musk: “The results of this ballot can be essential,” Mr. Agrawal wrote Monday. “Please vote fastidiously.”