Twitter Shares Rise 7.6% After Musk Allows Loan Commitments to Expire, Commits to More Financing
May 25 2022 - 5:48PM
Dow Jones News
By Denny Jacob
Twitter Inc. shares rose 7.6% to $40 in after-hours trading
Wednesday after Elon Musk allowed loan commitments connected to his
takeover of the social media platform to expire, and committed to
more funding in the deal.
The Tesla Inc. chief executive committed to provide an
additional $6.25 billion in equity financing to fund a portion of
his planned acquisition of Twitter, according to securities
filings. This brings the aggregate principle amount of the equity
commitment to $33.5 billion.
Mr. Musk also allowed the remainder of the margin loan
commitments in the commitment letter from Morgan Stanley Senior
Funding Inc. and other financial institutions, which committed to
provide Mr. Musk up to $12.5 billion in margin loans to fund a
portion of his acquisition, to expire, according to securities
filings.
Mr. Musk may replace portions of the previous financing
commitments, according to the filings.
The filings also said he is having discussions with certain
existing shareholders, including former Twitter CEO Jack Dorsey,
about the possibility of contributing common stock shares to a
parent entity at or immediately prior to the close to retain a
stake in the parent entity or Twitter after a merger is
complete.
Twitter CEO Parag Agrawal told shareholders the company is
proceeding with work on the agreed $44 billion takeover by Mr. Musk
after the billionaire said the deal was "temporarily on hold," The
Wall Street Journal reported Wednesday.
Write to Denny Jacob at denny.jacob@wsj.com
(END) Dow Jones Newswires
May 25, 2022 17:33 ET (21:33 GMT)
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