Elon Musk is getting a little help from billionaire friends for his $44 billion Twitter takeover.
According to an SEC filing Thursday, Musk has secured $7.14 billion in new financing commitments for the Twitter bid, including $1 billion from Larry Ellison. Ellison, co-founder and CTO of software giant Oracle, also sits on the board of Tesla, which Musk heads as CEO.
In addition, Prince al-Waleed bin Talal of Saudi Arabia committed to retain the equity he owns in Twitter — his 35 million shares are worth $1.9 billion at Musk’s buyout offer — instead of receiving a cash payout, per the filing.
Musk “will continue to have… discussions with certain existing holders” of Twitter stock, including ex-CEO Jack Dorsey, to contribute their shares toward his bid, according to the filing. Dorsey owns about 18 million Twitter shares, representing 2.4% of outstanding shares (worth $975 million at Musk’s proposed price).
Musk’s latest funding also includes $800 million from VC firm Sequoia Capital; $500 million from cryptocurrency exchange Binance.com; and $400 million from a16z, the VC firm founded by Marc Andreessen and Ben Horowitz.
Last week, Musk disclosed sales of Tesla stock worth more than $8.4 billion, which was presumably also part of amassing funds for the Twitter deal. Twitter’s board accepted Musk’s $54.20/share acquisition proposal on April 25. The deal is pending regulatory and shareholder approvals, which analysts don’t see as stumbling blocks.
According to Musk’s May 5 filing, with the new financing commitments, he has reduced the $12.5 billion margin loans he had lined up for the Twitter takeover to $6.25 billion. The deal now comprises $27.25 billion in equity financing (up from $21 billion previously).
Musk, the world’s richest person, has gained millions of Twitter followers since he revealed his 9.2% stock holdings April 4. He currently has nearly 91 million, up from about 80 million at the beginning of April.
Musk has claimed he’s mainly interested in protecting “free speech” on Twitter, and he has criticized the company for allegedly having a left-leaning political bias. He’s also spitballed a bevy of ideas for changes he wants to make at Twitter, including open-sourcing its algorithms for greater transparency; authenticating all users; shifting its business model toward subscriptions; and potentially charging companies and governments to use Twitter.
Twitter on Wednesday hosted its 2022 NewFronts presentation for marketers in New York, where it announced content deals including a pact with Fox Sports for exclusive World Cup programming. Twitter execs largely avoided the elephant in the room. The only reference to their potential new owner came from VP of global client solutions JP Maheu, who deadpanned, “It has been a quiet month at Twitter.”
Twitter shares were up 2.7% in premarket trading Thursday, to $50.36/share — still under Musk’s $54.20/share offer, indicating investor skepticism that the buyout will be consummated.