According to a report by Bloomberg Law, Elon Musk is attempting to obtain enough equity and preferred financing for his proposed takeover of Twitter to avoid the requirement for a $6.25 billion margin loan tied to his Tesla shares.
Through his advisors Morgan Stanley, Musk is reportedly seeking interest from high profile investors for up to $6 billion in preferred stock financing, citing anonymous sources familiar with the discussions.
If successful, that would eliminate the need for Musk’s margin loan, which just last week was $12.5 billion. That was reduced after securing more than $7 billion from investors, including Oracle co-founder and Tesla board member Larry Ellison.
Musk was even able to convince Saudi Arabian investor Prince Alwaleed bin Talal to roll his existing $1.89 billion stake in the company into the new venture. Prince Alwaleed had previously come out publicly against Musk’s bid, saying on April 14 the price offered did not come close to the “intrinsic value of Twitter given its growth prospects.”
I don't believe that the proposed offer by @elonmusk ($54.20) comes close to the intrinsic value of @Twitter given its growth prospects.
Being one of the largest & long-term shareholders of Twitter, @Kingdom_KHC & I reject this offer.https://t.co/Jty05oJUTk pic.twitter.com/XpNHUAL6UX
— الوليد بن طلال (@Alwaleed_Talal) April 14, 2022
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