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It’s starting to feel like we have reached peak Elon Musk. What began with world-changing electric vehicles and progressed to rocket ships has culminated in… a quixotic takeover bid for Twitter by the world’s richest man.
“If our Twitter bid succeeds, we will defeat the spam bots or die trying!” Musk tweeted on Thursday.
And authenticate all real humans
— Elon Musk (@elonmusk) April 21, 2022
Musk has built the biggest package of acquisition financing ever assembled by one person: $46.5 billion, two-thirds of which comprise of his own assets, and the remainder from banks. Musk has already assembled a 9.2% stake in TWTR, so the funding would be to buy the rest and take the company private.
The leveraged buyout strategy is a well-worn path—Musk has funded his own portion of the deal financing with a $12.5 billion margin loan secured by his equity stake in Tesla Inc. (TSLA), while the rest is secured by Twitter’s own assets. Leverage at this scale involves titanic risks.
But Musk has already dismissed these petty concerns. He recently commented that he “did not care” about the economics of the deal “at all,” and that he was pursuing Twitter because it was “extremely important to the future of civilization.”
A week ago, Musk offered Twitter’s board $54.20 per share to take the company private, and briefly flirted with taking a seat on the same board, before crashing out of that route.
Shares of TWTR were just shy of $40 heading into April before the current saga began, and topped out around $53 per share as Musk accumulated his stake and played footsie with Twitter’s board. Shares fell as the grandiose nature of the deal revealed itself, never reaching $54 a share.
For its part, Twitter has adopted a “poison pill,” or a contingency that will kick in if Musk ups his stake to 15% or…
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