Billionaire Elon Musk has again changed plans to fund the agreement with Twitter. He now plans to finance with $33.5 billion in investor funding and equity, reducing leverage.
Bloomberg writes about this with reference to the disclosure of changes in the plan for the redemption of the social network by the Securities and Markets Commission (SEC).
It is noted that Musk partially abandoned plans to raise bank loans tied to his stake in Tesla in favor of funding from investors.
Musk will provide $6.25 billion in additional funding, according to filings with the SEC.
“This is enough to exclude loans for the same amount from the plan,” explains Bloomberg.
The agency recalls that Musk agreed to acquire Twitter at the end of April. At first, Musk planned to borrow $25.5 billion from banks to buy it and pay another $21 billion from his own capital. The $12.5 billion in loans were tied to Musk’s stake in Tesla.
At the same time, by attracting funding from investors, Musk can reduce both the amount of borrowed capital and the amount that he must personally contribute, Bloomberg explained earlier.
The partners that Musk found to buy Twitter previously included 19 investors. More than others – $ 1 billion – Musk was allocated by the trust of Oracle co-founder of billionaire Larry Ellison. $0.8 billion was provided by the Sequoia Capital fund, $0.7 billion by the VyCapital investment company, $0.5 billion by the Binance cryptocurrency exchange. Investors also included Brookfield, Fidelity, Qatar Holding.
Elon Musk said that he would not renew the agreement to purchase the social network Twitter if the company does not prove the number of false accounts at the level of up to 5% of all users.
Musk said earlier that he was temporarily suspending his agreement to buy Twitter until confirmation that fake accounts make up less than 5% of users that can be monetized. At the same time, he assured that he “still intends to acquire” the company.
On April 25, it was revealed that Musk was buying Twitter for $44 billion after weeks of negotiations.
Founded 16 years ago, Twitter has been publicly traded since 2013. Nine years later, the company returns to private hands.
The agreement has been unanimously approved by the company’s board and is expected to be finalized this year.
The passage of this agreement will be the largest acquisition in the history of technology and is likely to have significant consequences over the next years for the billions of people using social networks.