Elon Musk says he has $46.5B in financing ready to buy social media company Twitter
Elon Musk says he has lined up $46.5 billion in financing to buy Twitter, and he's trying to negotiate an agreement with the company.
Last week, Musk announced an offer to buy the social media company for $54.20 per share, or about $43 billion. At the time, he did not say how he would finance the acquisition.
The Tesla CEO said Thursday in documents filed with US securities regulators that he's exploring what's known as a tender offer to buy all of the social media platform's common stock for $54.20 per share in cash. Under a tender offer, Musk, who owns about 9% of Twitter shares, would take his offer directly to other shareholders, bypassing the board.
But Musk hasn't decided yet whether to do that.
The documents say San Francisco-based Twitter Inc. has not responded to Musk's proposal.
Last week Twitter's board adopted a “poison pill” defence that could make a takeover attempt prohibitively expensive.
The filing states that “entities related to (Musk) have received commitment letters committing to provide an aggregate of approximately $46.5 billion.”
The financing would come from Morgan Stanley and other financial institutions. Some would be secured by stock that Musk owns in Tesla, the electric car and solar panel maker.
Musk “is seeking to negotiate a definitive agreement for the acquisition of Twitter ... and is prepared to begin such negotiations immediately,” the documents say.
With a tender offer, Musk would try to get other shareholders to pledge their stock to him at a certain price on a certain date. If enough shareholders agree, Musk could use that as leverage to get the board to drop the poison pill defence.
Musk signalled the possibility of a tender offer several times this week in tweets using the word “tender.”