The whole Elon-Twitter Board spat is awesome; watching an absolute genius and hilarious Twitter troll battle it out with a collection of aging, leftist midwits is beyond funny and trying to guess how Elon’s gonna get past their futile efforts to stop him is seriously exciting.
Now things are kicking up a notch, with the New York Post describing what financial moves are currently going on as Elon scrambles to raise cash to finance his original, $43 billion buyout. In its words:
Elon Musk is the richest person in the world, but he’s scrambling to assemble a buyout bid for Twitter using other people’s cash.
The Tesla tycoon — who is worth $270 billion, according to Forbes — is angling to finance his $43 billion bid to acquire Twitter in a complex deal that raises debt against both the company and possibly his own stock, as well as a giant cash equity infusion from co-investors, The Post has learned.
Still, insiders say Musk appears to be facing hurdles in raising the money. In addition to doubts about whether Twitter is worth the $54.20 a share that Musk offered on Thursday, sources said some investors appear skittish over his pattern of unpredictable behavior and taste for controversy.
Musk himself is willing to invest between $10 billion and $15 billion of his own cash to take Twitter private, two sources close to the situation said. That’s up from the current 9.1% stake in the company he revealed on April 4, which is worth about $3.4 billion.
That’s important on its own, as it shows the contours of what a deal might look like and how Elon could come up with the liquidity necessary for the takeover; rather than needing to sell off massive amounts of Tesla stock, Musk will be working with a few other trusted partners to come up with the cash.
And, as a reminder, the poison pill isn’t necessarily a rejection of Musk’s offer, just a way to prevent him from buying up the company’s stock by limiting him to 14.9%.
So, perhaps the original bid will go through as announced by Musk originally and as reported on by the New York Post.
But, even if it doesn’t, the NYP’s report on how Musk is raising the cash could hint at what Musk’s “Plan B” is; assuming Musk can buy his full 14.9%, an amount that wouldn’t trigger the poison pill, he’d just need a team of trusted friends to buy the remaining 35.1% necessary to take over the company, with those people also staying under the 14.9% limit to avoid triggering the poison pill.
Hence why the “co-investors” line in the NYP’s report is important: assuming it’s true, if those co-investors are willing to front the cash to take Twitter private, would they not be willing to buy large enough stakes to just take it over and then take it private from there?
It certainly seems possible and like a reasonable way for Elon to get around the Board’s attempt to block him and complete his goal of taking over the company. Now we’ll see what the board does next and how Musk again counters their feeble attempt to stop him.