Elon Musk, whom multiple outlets have called “the real Tony Stark,” is maneuvering to take over one of the biggest tech companies in the world — no small task. Undeterred by the board’s rejection of his first offer of $43 billion to purchase Twitter, Musk now appears to be moving to “plan B.”
According to The Daily Wire, Musk, the world’s richest man, “slightly shifted his strategy in his attempt to buy out Twitter and take the company private.”
The New York Post reports that Musk, who offered to buy Twitter on April 14, is now seeking to finance the takeover plan “in a complex deal that raises debt against both the company and possibly his own stock, as well as a giant cash equity infusion from co-investors.”
This plan differs from the plan detailed in an SEC filing last week, which stated he was “offering to buy 100% of Twitter for $54.20 per share in cash, a 54% premium over the day before I began investing in Twitter and a 38% premium over the day before my investment was publicly announced.”
Sources reportedly told the New York Post that Musk was now planning to increase his original $3.4 billion investment in Twitter stock to up to $15 billion in order to take the company private.
The Post report also noted that $20 billion of the financing would come from outside investors. Those investors, combined, will own more stock than Musk; however, Musk will remain the largest individual shareholder.
Musk has reportedly hired Morgan Stanley to raise $10 billion in debt against Twitter “in the manner of a traditional leveraged buyout.”
According to reports, “Musk is planning to launch a ‘tender offer’ for Twitter in 10 days or so.” This will involve the co-investors financing “a hostile tender offer directly to Twitter shareholders.”
Musk possibly hinted at the coming “tender offer” in a cryptic tweet on Saturday. His brief post read: “Love Me Tender,” and included musical note emojis.
Some speculate that the word “tender” in the title of the song Musk cited references his plan to present a “tender offer” to Twitter, Inc. shareholders.
Bloomberg News reported: “If Twitter directors ultimately reject him, the world could learn whether Musk was truly threatening a direct appeal to shareholders or had just added the 1956 Elvis Presley hit ‘Love Me Tender’ to his playlist.”
The U.S. Securities and Exchange Commission (SEC) notes that a “tender offer” “is typically an active and widespread solicitation by a company or third party (often called the ‘bidder’ or ‘offeror’) to purchase a substantial percentage of the company’s securities.”
According to the Daily Caller, “a tender offer is only available for a short period of time and is made to everyone who owns stock in the company. The price offered to purchase the shares is fixed and usually comes at a premium rate compared to the current market value of the stock.”
Scroll down to leave a comment and share your thoughts.