Musk fires Twitter chiefs to avoid payouts while he plans layoffs, say reports
Twitter’s new owner Elon Musk fired top executives in an effort to avoid hefty severance payouts, while lining up other layoffs as soon as Saturday to avoid stock grants due on November 1, according to media reports on Saturday.
Musk fired Twitter CEO Parag Agrawal, CFO Ned Segal and legal affairs and policy chief Vijaya Gadde on completion of a high-profile $44bn buyout of the social media platform on Thursday, informed sources told Reuters.
He accused them of misleading him and Twitter investors about the number of fake accounts on the platform. According to research firm Equilar, the executives stood to receive separation payouts totalling about $122m.
Citing unidentified sources, The Information reported that Elon Musk terminated four top Twitter executives, including Agrawal and Segal “for cause”, in an apparent effort to avoid severance pay and unvested stock awards.
In a tweet on Saturday LightShed analyst Rich Greenfield said Musk fired top Twitter execs “for cause”, preventing their unvested stock from vesting as part of a change of control.
Twitter did not immediately respond to Reuters’ request for comment.
Reuters could not make contact immediately with the fired executives.
Equilar research director Courtney Yu told Reuters on Friday that the fired
Twitter executives “should be getting these (severance) payments unless Elon Musk had cause for termination, with cause in these cases usually being that they broke the law or violated company policy”.
Meanwhile, The New York Times reported on Saturday that Musk ordered job cuts across the company, with some teams to be trimmed more than others and layoffs taking place before November 1, when employees were scheduled to receive stock grants as part of their compensation.
Citing unidentified people familiar with the matter, the Times reported the cuts could begin as soon as Saturday.