Twitter buy | Elon Musk increased his direct contribution to the acquisition to 33.5 billion

(San Francisco) Elon Musk raised the amount directly provided by the businessman and his partners for the acquisition of Twitter to 33.5 billion dollars, reducing the amount borrowed from banks, which is the happiest announcement for investors.

Updated yesterday at 6:30pm.

Thomas Urban with Julie Gamot in San Francisco
France media agency

Following the announcement, Bluebird Group’s movement rose in trading after the Wall Street close. At around 11pm GMT, the stock had gained more than 5%.

The Tesla CEO, who initially underwritten 25.5 billion loans, has cut those loans to $13 billion, according to a document registered Wednesday by the US Markets Authority (SEC), significantly easing the financial burden.

At the beginning of May, many of Twitter’s existing shareholders had already agreed to contribute their shares to the operation, thus remaining a minority within the capital once the company was delisted.

Evaluating their titles reduced the circumstance that Elon Musk had to put on the table.

On Wednesday, the SpaceX founder announced that he had received new direct commitments, which allowed him to reduce the amount of loans taken for the acquisition by an additional 6.25 billion.

He did not specify whether this amount came in whole or in part from his personal assets, or whether other investors had joined in.

poker movement

But he said he had discussions with several people, including co-founder and former CEO Jack Dorsey, with the goal of engaging them and getting their input, either in cash or in Twitter posts, which could still reduce the amount borrowed.

“Elon Musk is simply changing the financing structure. This is a step forward, it partially reduces pressure on the debt side,” expert Dan Ives, of Wedbush, commented on Twitter.

“The high-stakes poker game continues. The odds of executing the deal are now 50/50, down from 40/60, in our opinion,” he added.

The $12.5 billion in loans that were ultimately not needed have some analysts worried because they were loans backed by Tesla securities. Thus they established a relationship with the car manufacturer, much to the chagrin of the market.

Since revealing Elon Musk’s stake in the Twitter capital in early April, the group has lived to the rhythm of many twists and turns in the case.

On Tuesday, the measure fell to $35.40, or 35% below the price the fiery businessman formally proposed in mid-April and was approved, shortly thereafter, by the Board of Directors (CA).

It turned out to be interpreted by Wall Street as clarifying investors’ skepticism about the chances of success of this acquisition.

One less ally

These doubts were stoked by the billionaire himself, who exploded in hot and cold weather last week.

In particular, he announced that he was suspending the operation because he wanted to ensure that “spam and fake accounts really represent less than 5% of the number of users”. Before she renewed her commitment to get on the social network.

Twitter chief Parag Agrawal has gone up to detail the measures taken to combat fake accounts and Elon Musk has responded with several messages, including a simple laughing emoji.

On Wednesday, during the group’s general meeting, shareholders voted against CA’s re-election of Egon Durban, co-general manager of Silver Lake investment fund and ally of Tesla’s chief.

The issue of the acquisition was not raised during the Ordinary General Assembly meeting. A shareholder vote on Elon Musk’s bid shall be the subject of an extraordinary general meeting, on a date unknown at the present time.

Tensions between Twitter’s management and the world’s richest man have multiplied since the beginning of April.

CA initially tried to block the deal before kneeling.

Elon Musk, who has more than 95 million subscribers on his profile, says he wants to make the platform a bulwark of free speech, according to the vision of the American right, which considers itself censored by social networks.

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