Elon Musk has landed $46.5bn (£35.6bn) of funding commitment to snap up Twitter, as the takeover approach intensifies.
The world’s richest man has filed new documents with the US financial regulator revealing how he plans to finance the bid.
Musk has committed to put up $33.5bn, which will include $21 billion of equity and $12.5bn of margin loans secured against his shares in Tesla. Banks, including Morgan Stanley, have agreed to stump up an additional $13bn in debt financing.
Under current plans, the Tesla boss said he would unlock Twitter’s “extraordinary potential” to back free speech and democracy.
However, Twitter’s board has rebuffed his proposals, adopting a ‘poison pill’ tactic in order to obstruct Musk’s plans to snap up the social media firm.
Twitter’s board unanimously approved a limited-duration shareholder rights plan. Considered a final line of defence the ‘poison pill’ allows existing shareholders to buy stocks at a substantial discount to dilute the holdings of new investors.
In place for a year, the strategy means existing investors will be able to buy more shares at a discount if Musk’s current nine per cent stake rises more than 15 per cent.
Today’s filings reveal Musk is considering a tender offer for Twitter which would allow him to circumvent the board and make his offer directly to shareholders.
Responding to speculation about the strategy on Twitter, Musk had slammed the platform’s board, with relations between the two now set to sour further.
“If the current Twitter board takes action contrary to shareholder interests, they would be breaching their fiduciary duty,” Musk said. “The liability they would thereby assume would be titanic in scale.”