BREAKING: Elon Musk Has Secured $46.5 Billion in Funding to Purchase Twitter

Shortly after making his $43 billion offer to take Twitter private, Elon Musk admitted that he might not be able to pull together the cash to make it happen. Well, it now appears that he has put together the necessary funds for the buyout.

Reuters reported that Musk has scraped together enough of his own money and found various other parties willing to front more funds to make the bid happen. 

Musk will contribute $33.5 billion of his money to the venture and “will include $21 billion of equity and $12.5 billion of margin loans to finance the transactions, Reuters reported. The rest of the $46.5 billion in debt is provided by Morgan Stanley in which that debt will be secured against Twitter, not Musk.
But it seems Musk is not the only wealthy American looking to buy Twitter and take it private.
According to a different article by Reuters, a private equity fund called Apollo Global Management is also considering an offer, though it’s reportedly working to either work with Musk or make the buyout happen on its own.

Reuters put it this way in their report, Apollo Management Inc. (APO.N) is considering ways it can provide financing to any deal and is open to working with Musk or any other bidder, the sources said. Its participation would be through its credit investment platform rather than its private equity business, the sources added.

However, it isn’t clear whether Musk would work with Apollo. If Twitter accepts his original $43 billion bid, then he wouldn’t need to, as he’s now put together more than $46 billion in funding himself. If it doesn’t accept his bid, then he might move on to “Pland B,” as he wrote in his letter that $43 billion was his final offer.

Musk said of his offer, “As a result, I am offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced. My offer is my best and final offer and if it is not accepted, I would need to reconsider my position s a shareholder.”

Maybe Musk is just bluffing, but he seems intent on bending Twitter to his will rather than negotiating, so it seems doubtful that he’d reconsider his original language and offer even a higher price than what he has already offered.

Adding to this scenario, Musk has shown a certain vision of Twitter, one that a profit-focused private equity fund might not be willing to go along with.

Again, commenting on his offer, Musk said, “This is not a way to make money. My strong intuitive sense is that having a public platform that is maximally trusted and broadly inclusive is extremely important to the future of civilization.”

Perhaps Apollo would be willing to go along with that and accept his view of a Twitter that acts in a way that’s good for society rather than however is most profitable, but it seems unlikely. Then again, his letter to the Board of Twitter said, “Twitter has extraordinary potential. I will unlock it.” 

Maybe these words in the letter to the Board could have appealed to Apollo. It seems we’ll have to wait and see; with the funding secured on Musk’s part, now the ball is firmly in Twitter’s court.

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