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Elon Musk: Smart financial and strategic move
Photo: Joe Skipper / REUTERS
Tech entrepreneur Elon Musk has secured more than $7 billion in commitments from investors for its proposed takeover of short message service Twitter.
According to an IPO filed by Musk, 19 investors have committed to equity investments totaling $7.14 billion.
Among them is the founder of software giant Oracle, Larry Ellison, who wants to contribute $1 billion.
Mutual funds Sequoia Capital, Vy Capital and Brookfield are said to have received $800 million, $700 million and $500 million, respectively.
The Saudi Arabian prince and businessman Al-Walid bin Talal is making his nearly 35 million Twitter shares available.
He wants to secure a future stake in Twitter if Musk delists the online platform as planned after a takeover.
In return, Musk reduced a loan commitment from Bank Morgan Stanley and other financial institutions from $12.5 billion to $6.25 billion, according to the document filed with the US Securities and Exchange Commission.
Last Monday, Twitter announced an agreement for Musk to acquire the company for around $44 billion.
He had previously stated that he had secured $46.5 billion in financing for the purchase of the online platform.
Accordingly, there were two loan commitments from Morgan Stanley and other financial institutions in the amount of $ 12.5 billion and $ 13 billion, Musk wanted to raise the remaining $ 21 billion from his own funds.
Musk then sold millions of Tesla shares worth more than $8 billion in the days following the announcement of the acquisition.
The multi-billionaire with an estimated fortune of around 265 billion dollars has now restructured the planned financing for the Twitter purchase.
He also told the US Securities and Exchange Commission that he was in talks with other Twitter shareholders - including Twitter founder Jack Dorsey - to attract them as investors.
Wedbush Securities analyst Dan Ives called Musk's move a "smart financial and strategic move" that was well received by Wall Street.
The purchase of Twitter is now on track to be completed this year.
mike/AFP
