musk: Musk’s revised Twitter bid drops loan, needs more cash

Elon Musk is dropping plans to partially fund his purchase of Twitter with a margin loan tied to his Tesla stake and increasing the size of the deal’s equity component to $33.5 billion.
Musk will provide an additional $6.25 billion in equity financing for the $44-billion buyout, according to a regulatory filing Wednesday. That’s enough to eliminate the margin loan of the same size, which had already been reduced earlier this month.
The new structure could reduce the risk of the deal for both Musk and his lenders, particularly given the recent slide in Tesla’s stock price. The electric carmaker has sunk about 40% since Musk first announced his stake in Twitter in early April. An extended slump raised the prospect that he wouldn’t have enough unpledged shares to cover the margin loan.
Musk, Tesla’s co-founder, is still on the hook for coming up with the full $33.5-billion equity component. But he can turn to others for help. Musk is seeking additional financing commitments, including having talks with investors about rolling their equity into the private company, according to the latest filing.
Dorsey Leaves Board
Twitter’s former chief executive officer Jack Dorsey has officially left the social network’s board, ending his formal relationship with the company he co-founded in 2006. His exit marks the first time in Twitter’s history that none of its co-founders is working at the company, or sitting on the board. bloomberg

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