We still don’t know how the novel between Twitter and Elon Musk will end. We know that the oral hearing already has a date, but it seems that, behind the scenes, things are something different. As reported from Bloombergthe reason why you can also stall the purchase has something more to do with money than with bots.
Although Elon Musk initially had the money to make the purchase, according to sources close to the matter, it now depends on receiving $13 billion in debt financing. And it is that, according to the report sent to the SEC on October 3, Elon agreed to close the purchase in the original terms, set at $54.20 dollars per share. However, the CEO of Tesla was at the “waiting to receive proceeds from debt refinancing”something that was not in the original agreement.
It is an important change, since part of the money for the purchase comes from a syndicated loan between several investment banks through the issuance of debt for the operation, so it is not something immediate. If the deal were to close immediately, Elon would receive his money, and the banks would then issue the debt commitments after the deal closes.
Money, a new problem for Elon Musk and the banks that finance the purchase
The main stumbling block is that, even if the banks have time to sell all the debt from the closing of the deal to the completion of the sale, credit market conditions have deteriorated sharply since April, date when all this drama started.
In fact, according to BloombergMorgan Stanley, one of the most relevant for the operation, could have considerable difficulty finding buyers for all bonds and loans. That would mean that it would be the investment bank that would incur losses on at least part of everything that is going to be lent to Elon. And that, of course, is not Elon’s problem, but it would affect the development of the purchase.
In addition to the debt issue, there is also Elon himself in the eye of the storm. The CEO of Tesla also he wants to keep an ace up his sleeve in case things get out of hand, and according to BloombergMusk seeks to reserve his rights to file a fraud lawsuit.
Again, back to the bot issue, as Musk would continue to insist that he and other investors were misled by platform executives about the amount of spam among its more than 230 million users. Now it will be time to wait for the oral hearing.