Elon Musk gestures during a press conference at SpaceX's Starbase facility near Boca Chica Village in South Texas. - Elon Musk takes control of Twitter and fires his top executives, US media reported from the October 27, 2022 deadline to seal his on-and-off, off-again deal to buy the social media network for the billionaire Reported a few hours ago.
Elon Musk secured nearly $13 billion by bank loan to finance the Twitter deal.
Elon Musk's deal was finalized on 27 October. The world's richest man initially wanted to limit his investments to a little over $15 billion in the $44 billion deal. His stake in Tesla was expected to support about $12.5 billion in debt, so he may have avoided selling those shares.
The Tesla CEO eventually abandoned the borrowing plan and contributed more cash. In the end, Musk sold about $15.5 billion worth of shares in Tesla in two waves in April and August. In the end, the 51-year-old would personally pay off the transaction for a little over $27 billion in cash.
As part of the agreement, software business Oracle co-founder Larry Ellison wrote a $1 billion check in addition to $5.2 billion from investment organizations and other large funds.
Qatar Investment Authority, which controls Qatar's sovereign wealth fund, Qatar Holding, has also contributed funds. About 35 million shares already owned by Prince Alwaleed bin Talal of Saudi Arabia were transferred to Musk. Contributors will receive Twitter shares in return for their investment.
Of the balance, about $13 billion is secured by bank loans, including those from Morgan Stanley in France, Bank of America, Mitsubishi UFJ Financial Group, Mizuho, Barclays, Societe Generale and BNP Paribas.
Morgan Stanley alone contributed about $3.5 billion, according to data submitted to the US Securities and Exchange Commission. Twitter will be responsible for the financial obligation to repay these debts, not Musk personally. Twitter has guaranteed these loans.
Elon Musk, who was born in South Africa, has an estimated net worth of $220 billion. It is interesting to note that he already controls 9.6% of Twitter's market share.
Given that Twitter has been unable to produce a profit so far and has run into losses by the first half of 2022, the debt resulting from the acquisition could further strain the company's already dire financial situation.
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