Elon Musk has secured additional funding to purchase Twitter, according to financial filings made public on Wednesday, moving the billionaire closer to completing the high-profile deal.
The Tesla CEO said in the regulatory filings he has increased his personal funding of the purchase from $27.3bn to $33.5bn and secured an additional $6.25bn in equity financing, reducing the amount of debt the entrepreneur would take on in the $44bn purchase.
Musk originally took a $12.5bn margin loan against stock of his electric car maker company Tesla to help fund his purchase of Twitter. But he reduced it to $6.25bn earlier this month after bringing in co-investors.
Investors also blocked the re-election of a Musk ally to the board, voting against Egon Durban, the co-head of private equity firm Silver Lake, who partnered with Musk on his abandoned bid to take the electric carmaker private.
The sharp turnaround makes little sense except as a tactic to scuttle or renegotiate a deal that is becoming increasingly costly for him, experts said last week. That the discussions are playing out publicly, on Twitter no less, only adds to the chaos.
Experts say Musk cannot unilaterally place the deal on hold. If Musks walks away, he could be on the hook for a $1bn breakup fee. Alternatively, Twitter could sue Musk to force him to proceed with the deal, although experts think that is highly unlikely.
Even if shareholders approve proposals, it will be non-binding, said Donna Hitscherich, a professor of finance at Columbia Business School.
Twitter shares jumped around 6% to $39.15 in extended trading.
Musk could not be immediately reached for comment on details of the regulatory finding.
