Musk gets USD 7 billion backing for Twitter bid from tech heavyweights

PTI | Sanfrancisco | Updated: 05-05-2022 19:36 IST | Created: 05-05-2022 19:36 IST
Musk gets USD 7 billion backing for Twitter bid from tech heavyweights

Billionaire Elon Musk has strengthened the equity stake of his offer to buy Twitter with commitments of more than USD 7 billion from a range of investors, including Silicon Valley heavy hitters like Oracle co-founder Larry Ellison.

Other investors include Sequoia Capital Fund, which pledged USD 800 million, and VyCapital, which pledged USD 700 million, according to a Thursday filing with the US Securities and Exchange Commission.

But Ellison, who is also a and Tesla board member, is making the biggest contribution, pegged at USD 1 billion.

Saudi Prince Alwaleed Bin Talal Bin Abdulaziz Alsaud has pledged USD 35 million in Twitter shares in support of Musk, according to the filing.

Musk in earlier regulatory filings revealed that he has sold roughly USD 8.5 billion worth of shares in Tesla to help fund the purchase.

Musk later tweeted that he doesn't plan any further sales of the company's shares, meaning he would need outside commitments to help fund the USD 44 billion deal.

Because of the new funding listed in the SEC filing on Thursday, Musk will cut the USD 12.5 billion in margin loans he was leaning on in half, to USD 6.25 billion. The transaction is also now being funded by USD 27.25 billion in cash and equities, up from USD 21 billion.

The Thursday filing also said that Musk is in ongoing talks with other parties including former Twitter CEO Jack Dorsey, who is the second largest individual stakeholder in the company after Musk.

“This was a smart financial and strategic move by Musk that will be well received across the board and also shows the Twitter deal is now on a glide path to get done by the end of this year,'' wrote analyst Dan Ives who follows Twitter for Wedbush.

Shares of Twitter Inc. have remained below the per-share offering bid by Musk of USD 54.20 because there are still doubts on Wall Street about whether the deal will go through.

Shares of the San Francisco social media platform rose two per cent before the opening bell, to USD 50.10.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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