After agreeing to buy Twitter out for $44 billion USD and take it private, Tesla and SpaceX CEO Elon Musk is reportedly telling potential co-investors he could return the social media company to public ownership, in as little as three years of acquiring it — reports The Wall Street Journal.
Musk’s financing for the deal comprises $13 billion in debt financing, a $12.5 billion margin loan commitment from Morgan Stanley and 11 other banks, secured in part by his holdings in Tesla, and $21 billion in equity financing that he will be putting up himself.
Twitter has said it expects the deal to close later this year, contingent on the approval of Twitter shareholders and regulators. Musk could stage an initial public offering for Twitter to take it public just a few years after taking over, people familiar with the proceedings told The Wall Street Journal.
The celebrity billionaire continues to seek co-investors for the deal to help reduce how much equity he will have to pour into acquiring Twitter. Musk has reportedly been in talks with several private-equity firms, with one — Apollo Global Management Inc. — considering taking him up on the offer.
It is not uncommon for private-equity firms to take companies private, improve their performance and profitability out of the limelight and stringent oversight that public companies are subject to, and take them public again later to turn a profit.
Musk might be looking to do something similar, even though said he doesn’t care about the economics of owning Twitter when he spoke at the 2022 TED Talk in Vancouver, B.C., last month. Musk has said his ambitions behind acquiring Twitter are to turn it into “the platform for free speech around the globe.”
Twitter’s soon-to-be new owner hasn’t really revealed much about his plans for the social media site beyond stressing the importance of uncensored, free speech. According to a report from last week, Musk’s first priorities are job cuts and new ways to monetize Twitter.
One thing’s for sure: Musk has his work cut out for him at Twitter. The company’s financial results and overall profitability have been in dire straits for quite some time now.