Elon Musk has completed the $44 billion deal announced in April to make Twitter Inc private and take ownership of the influential social media platform by promptly firing top executives.
“The bird has been released,” he wrote on Twitter, an apparent sign of his desire to see the company have fewer restrictions on the content that can be posted, but Musk offered little clarity on how to achieve his goals. Earlier this month, Musk put the deal back on the table after Having previously tried to walk away from it, Musk said he’s excited to buy Twitter but he and his fellow investors are overpaying.
What is his financing plan?
Musk pledged $46.5 billion in equity and debt financing for the acquisition, which covered the $44 billion price and closing costs, and banks, including Morgan Stanley and Bank of America Corp, committed $13 billion in debt financing.
The experts said that the banks’ commitments to the deal were tight and tight, which limited their ability to withdraw from the contract despite the possibility of them incurring significant losses, and Musk’s commitment to shares of $33.5 billion secured his 9.6% stake in Twitter, which is worth $4 billion, and $7.1 billion he obtained from stock investors, including Oracle Corp co-founder Larry Ellison and Saudi Prince Al-Waleed bin Talal.
That left Musk needing an additional $22.4 billion in funds to cover the equity financing portion of the deal, and since the disclosure of the co-supporters, Apollo Global Management Inc and Sixth Street Partners have pulled their bids off the table.
What did he pay out of his own pocket?
Musk, 51, is the world’s richest person with a net worth of $222 billion, according to Forbes magazine, but a large portion of his fortune is linked to his stakes in Tesla and Space X, and according to Reuters calculations, Musk earned about $20 billion in cash after selling part From his stake in Tesla through multiple transactions in November and December of last year and April and August, Musk needed to raise an additional $2 billion to $3 billion to complete financing the deal.
What about short financing?
It wasn’t immediately clear how Musk covered a funding gap of about $3 billion, but Wedbush analyst Daniel Ives said it could be offshore capital as the 4S was not introduced this week and it’s possible the investor is already backing the deal.
Musk was widely expected to sell more of his Tesla shares in the nine-day window between the electric car maker’s October 19 results and the October 28 deadline to close the deal.