Tesla Inc TSLA CEO Elon Musk’s fundraising efforts for his $44 billion Twitter Inc TWTR take-private bid have been put on hold due to uncertainty over the deal, Reuters reported on Tuesday, citing people familiar with the matter.
What Happened: Musk has to pay $33.5 billion in cash to fund the Twitter deal, while debt financing will cover the rest.
The billionaire has also been in talks to raise $2 billion to $3 billion in preferred equity financing from a group of private equity firms led by Apollo Global Management Inc APO that would further lower his cash contribution, the report said.
All such conversations are currently on hold until there is more clarity on the deal.
Musk’s wealth is linked to shares he owns in Tesla, implying his liquidity is limited.
Why It Matters: The development follows Musk’s threat to walk from the mega-deal as he accused the microblogging company of not revealing the right breakup of its user base, especially the spam accounts.
He has, without evidence, said fake users may make up at least 20% of all Twitter accounts. Some analysts have said Musk is likely using this issue as a scapegoat to walk away from the deal.
The pause in financing conversations indicates investors are weighing Musk’s threats and influence over the deal.
Price Action: Tesla closed 0.25% higher at $716.6 on Tuesday, according to data from BenzingaPro.
See Also: Elon Musk Sends Letter To Twitter: Here's Why The Social Media Stock Is Sliding
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