We just learned how Elon Musk plans to fund his $43 billion offer for Twitter

witter hasn't yet responded to Elon Musk's offer to buy the company, and he says he's

TRemember that Twitter itself has used poison pills to protect its stock in the wake of Tesla CEO Elon Musk's surprise offer.

Also in the filing, it says how Musk plans to pay for Twitter. Make sure you remember that his offer is worth about $43.4 billion in cash for each share of stock. The serial entrepreneur's bid is higher than Twitter's value today, but it's far below the company's 52-week stock market high of $73.34 per share. Shares of Twitter traded even higher in early 2021, leaving some room for Musk's bid to be considered modest, even though it's higher than Twitter's value today.

We don't know. In the end, it turns out that there are three main buckets:

  • First, Morgan Stanley and "certain other financial institutions" have agreed to provide Musk with $13 billion in financing, according to a filing. Musk will get a $6.5 billion "senior secured term loan facility," a $500 million "senior secured revolving facility," a $3 billion "senior secured bridge loan facility," and a $3 billion "senior unsecured bridge loan facility."
  • There is a second bucket of money that comes from Morgan Stanley and others, who have agreed to give Musk $12.5 billion in "margin loans" against his shares in Tesla and other companies.
  • Musk also signed a "equity commitment letter" that said he would "provide equity financing for the Proposed Transaction or the Potential Offer sufficient to pay all amounts payable in connection with the Offer and the Merger, excluding the above sources of financing." Files: The total value of this equity commitment from Musk "is likely to be about $21 billion."

Musk wants to borrow about $13 billion in different ways, borrow $12.5 billion against his own equity holdings, and pay about $21 billion from his own money. Musk's bid isn't small, so the process of getting all the money together in one place is a little more complicated than it should be.

Do not think that the "funding secured" notes above mean that the deal is a sure thing. "There can be no assurance that a definitive agreement with respect to the Proposed Transaction will be signed or, if signed, whether the Proposed Transaction will be consummated," says Musk's filing. "No tender offer for Twitter shares has been made or will be made by Musk."

It looks like Musk can get the money he needs to make his bid more than just words.

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