Elon Musk Raises $7 Billion Additional Funding for His Twitter Deal

Elon Musk arrives at the In America: An Anthology of Fashion themed Met Gala at the Metropolitan Museum of Art in New York on May 2, 2022. Brendan Mcdermid/Reuters

Tech billionaire Elon Musk has secured fresh financing from a group of investors that includes a Saudi prince and Oracle co-founder Larry Ellison for his $44 billion buyout of Twitter, according to a new securities filing on May 5.

The world’s richest man received equity commitment letters from 19 investors, committing to pay $7.14 billion in cash or Twitter common stock (valued at $54.20 per share), according to the document.

The largest contribution came from Saudi Prince Alwaleed bin Talal, a billionaire and one of Twitter’s largest stockholders, with a $1.9 billion commitment, followed by Ellison, who agreed to invest $1 billion.

Other investors include Sequoia Capital Fund, Canadian private equity firm Brookfield, asset management firm Fidelity, Qatar Holding, venture capital firm Andreessen Horowitz, and crypto exchange Binance.

The Saudi prince initially dismissed Musk’s $54.2 per share offer, stating on Twitter that it didn’t reflect the true value of the company. But now, he’s prepared to contribute his 35 million Twitter shares to remain a stakeholder in the private corporation.

Some investors believe that investing in Twitter is betting on Musk’s management rather than the company’s performance. They feel rewarded by his track record as a founder and operator of businesses such as PayPal, Tesla, and SpaceX.

Musk is expected to serve as a temporary CEO of the platform for a few months following the completion of his takeover, according to people who spoke to CNBC’s David Faber.

On April 25, Twitter accepted Musk’s proposal of $54.20 per share in cash, which put the firm’s value at about $44 billion.

Musk had secured $25.5 billion in loans, backed in part by a portion of his stake in Tesla, according to the announcement. He had also promised to provide nearly $21 billion in cash.

With the new money, the margin loan amount backed by Tesla shares will be reduced to $6.25 billion from $12.5 billion; the equity commitment has now increased to $27.25 billion from $21 billion, according to the filing.