Elon Musk takes over Twitter

They just halted trading on Twitter's stock.

Word is that Elon Musk is going to go through with the purchase at the $54.20 he offered.

 

Musk said to go ahead with $54.20 a share Twitter deal - Bloomberg reporter

 

The best part of this from what I am gathering. ... the hold up right now is that Twitter wants a guarantee from the court that if they drop the litigation he's not going to reneg all over again.

 

I was thinking about this earlier.

Tesla's stock is down since he made the offer, and that is his collateral for whatever financing he needs. But it's down less than a lot of other things.

He needs $44 billion. He already owns about 9 percent of the company, so that takes care of $4 billion. He had already lined up $7 billion of equity financing in May. So he still needs $33 billion. He sold something like $15.5 billion of Tesla stock earlier this year, but my understanding was that a lot of that went toward a tax bill on stock options he had exercised.

My guess is he has more equity financing lined up. So I am curious how much debt financing he's going to need. The money will be there if he needs it, but the bad thing for him is that the cost of that financing has gone up by a lot since he made his offer, as interest rates have gone up. Which is kind of delicious because he has been maybe the biggest beneficiary on earth of cheap money, so if he ends up having to roll over debt constantly at increasing cost, and Twitter's business struggles to keep up with the interest payments, he could end up getting slaughtered.