Elon Musk is in talks with major investment companies, as well as private financiers, to secure more funding for the $ 44 billion acquisition of Twitter Inc.
These moves of Musk are made in order to freeze as little of his property as possible in the mentioned takeover agreementaccording to sources who have been informed of his initiatives.
Musk is the richest man in the world, with Forbes estimating his net worth at $ 245 billion (€ 233 billion).
Most of his fortune is owned by shares in the electric vehicle company Tesla Inc., of which he leads. Last week, Musk revealed that he had sold $ 8.5 billion ($ 8.08 billion) worth of Tesla shares following a deal to buy him. Twitter.
The new financing, which can come from preferred or common equity, could reduce the $ 21 billion (€ 19.97 billion) liquidity that Musk has pledged to pay for the aforementioned acquisition, as well as a loan secured by his shares in Tesla, according to sources.
Banks that agreed last month to lend $ 13 billion (€ 12.37 billion) based on Twitter’s business performance were reluctant to offer more liquidity to buy Musk, given its low liquidity level. San Francisco-based Twitter Inc, as reported by Reuters last month.
Musk also committed some of the shares in Tesla to lend $ 12.5 billion (€ 11.89 billion) to finance the deal. According to one of the sources, he may seek to compensate differently the financial amount of the above loan, based on the new investment interest for its financing.
Large investors, such as private equity firms, investment fund management companies, but also wealthy investors, are talking to Musk about offering equity financing for the same acquisition, according to sources.
This type of financing will give them a specific return on Twitter, in the same way that a bond or loan yields interest at a specific interest rate, with the return increasing depending on the share value of the company.
Apollo Global Management Inc and Ares Management Corp. are among the private equity firms that are in talks with Musk to raise funding, the sources added.
He has not yet made a final decision on whether to work with others to secure the funding for the deal, and he does not currently seek to charge Twitter more, according to sources.
Musk is also talking to some of Twitter’s major shareholders about the possibility of including their stake in the deal instead of redeeming it, according to one source. Former Twitter CEO and board member Jack Dorsey is considering joining, one source added.
Large investment companies such as Fidelity also participate in the talks.
Musk posted on Twitter stating that it will try to keep as many investors as possible.
The sources spoke anonymously, as the matter is confidential.
Musk, Dorsey, but also Fidelity, Apollo and Ares did not respond to requests for comment.
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