Twitter stock gains after report says CEO Jack Dorsey plans to step down from top post

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Shares of Twitter Inc. jumped on Monday after CNBC reported that Chief Executive Jack Dorsey plans to step down from the top position at the social-media company.

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twitter share TWTR,
+3.42%
They were up 3.5% on Monday morning before trading halted for pending news. Square Inc. sq shares,
-0.41%
Soared up to 4.0%, but gave back those gains and were recently off 0.7%. Dorsey also serves as CEO of Square.

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“The jump in share prices is a sign that the market may have realized that a new CEO focusing on just one company may be more effective,” said Tim Hubbard, a management professor at the University of Notre Dame’s Mendoza College of Business. An emailed statement.

NS CNBC report Unknown sources cited. Twitter did not immediately respond to Businesshala’s request for comment.

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According to data from FactSet, Twitter has been the focus of active investor Elliott Investment Management, which holds 1.25% of Twitter’s shares outstanding. Twitter announced in March 2020 that it had reached an agreement with Elliott to buy back $2 billion of its shares, in an arrangement that was partially funded by investments from private-equity firm Silver Lake. Was.

At the time, Elliott was reportedly interested in seeing Dorsey step down, but Twitter revealed in November 2020 that the “management structure committee” of its board of directors, headed by an independent director, replaced the current one. Management assessed. structure, new operating plan and procedures implemented” and “recommended that the current structure remains in place.”

Twitter shares are down 21.7% in the past three months as the S&P 500 SPX,
+0.79%
has increased by 2.8%. The stock closed at a 10-month low on Friday.

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