ELON MUSK RAISES MORE THAN US$7 BILLION TO FINANCE THE PURCHASE OF TWITTER

 

Musk claimed to have raised $7.14 billion to fund the Twitter purchase. Among the investors, he mentioned Oracle co-founder Larry Ellison and Al Walid bin Talal, a Saudi prince and businessman.

In a document sent on Wednesday to the US stock exchange regulator, the SEC, the head of Tesla and SpaceX lists a total of 19 investors who have agreed to contribute to the acquisition of the social network.

Billionaire Larry Ellison, co-founder of computer giant Oracle and a member of Tesla's board of directors, will contribute $1 billion.

Investment funds Sequoia Capital ($800 million), Vy Capital ($700 million) and cryptocurrency exchange Binance ($500 million) are also among the top contributors.

Prince Bin Talal, for his part, will make available almost 35 million of his Twitter shares once the purchase is completed to retain a stake in the company's capital, which Musk wants to withdraw from the Stock Exchange.

This represents about $1.9 billion at Musk's proposed purchase price of $54.20 per share.

The Saudi investor had previously deemed Musk's takeover offer, of around $44 billion in total, too low compared to "Twitter's intrinsic value."

“Great to be in touch with you my new friend @elonmusk,” the prince tweeted on Thursday in response to a Tesla boss post from mid-April. "I think he will be an excellent manager of Twitter with a view to promoting and maximizing its immense potential," he added.

These contributions will allow the businessman of South African origin and the richest man in the world to reduce the amount of the margin loan that he has contracted with Morgan Stanley and other financial entities from 12,500 million dollars to 6,250 million.

A margin loan allows a borrower to increase their credit by pledging assets as collateral. In Musk's case, it's his Tesla shares.

At the same time, the portion of the Twitter acquisition financed in stock and cash by Musk and the list of investors will rise to $27.25 billion from $21 billion previously.

Musk also told the Securities and Exchange Commission of the United States (SEC for its acronym in English) that he was still looking for other sources of financing among the shareholders of Twitter, including the founder and former head of the platform, Jack Dorsey.