Tesla and SpaceX CEO Elon Musk detailed how he would finance his plan to buyout Twitter in a new filing on Thursday. File Photo courtesy of Tesla
April 21 (UPI) -- Elon Musk detailed his plan to finance the $46.5 billion offer he made last week to buy the rest of Twitter's shares in a new filing Thursday with the U.S. Securities and Exchange Commission.
The Tesla and SpaceX CEO received two debt commitment letters on Wednesday from Morgan Stanley Senior Funding and certain other financial institutions, which together commit to offering a series of loans worth $25.5 billion, according to the filing.
The remaining $21 billion will come from an equity financing commitment from Musk, who has yet to reach a formal agreement with Twitter on his buyout offer.
Musk is prepared to begin negotiations on a definitive agreement for the buyout immediately, the filing states.
Despite being the world's richest person, according to Bloomberg Billionaires Index, with a personal fortune estimated at $249 billion, Musk wasn't able to buy Twitter outright because the majority of his net worth is tied up in Tesla stock.
Though he now has funding secured, he still faces obstacles.
Last Friday, Twitter's board of directors unanimously voted to block the buyout bid through a "poison pill" strategy, which gives the company's existing shareholders an opportunity to buy discounted additional shares.
Also last week, a Twitter shareholder filed a federal security class action lawsuit against Musk over his failure to disclose his ownership stake in the social media platform.
Musk decided not to join Twitter's board of directors earlier this month since the agreement stated that he could not become the owner of more than 14.9% of Twitter's common stock.
He has had previous issues with the SEC over his use of Twitter, including being charged with misleading investors over a 2018 tweet in which he said he was "considering taking Tesla private at $420" per share. Under a settlement with the SEC, Tesla was required to approve any of Musk's tweets containing information that could affect the company's stock price.
Musk made an offer last week to buy the social media giant and transform it into a private company after acquiring more than 73 million Twitter shares, which amounts to a 9.2% stake and makes Musk the platform's largest shareholder.
Musk said that he's investing in Twitter because he believes it has the potential to be "the platform for free speech" worldwide.
He has also said that he would cut all pay to Twitter's board of directors if he takes over.