8 more days to hand over $ 44 billion to buy Twitter, Elon Musk admits to being bought wrong?

Recently, Elon Musk said that he and other investors “clearly overpaid” to buy Twitter.

However, the Tesla CEO said he was “excited about the Twitter situation,” describing the social media company as an asset that has “worn out for a long time” but has “worthwhile potential.”

Following Musk’s statement, Twitter shares rose in the following trading session.

The back-and-forth drama between Elon Musk and Twitter has lasted for many months but has not been finalized. The latest development is that on October 6, a judge in a Delaware state court ruled to suspend legal proceedings until October 28 at the request of Tesla CEO Elon Musk.

“ If the transaction is not closed by 5:00 p.m. on October 28, 2022, the parties will be instructed to contact me by email that evening for a hearing date for the dispute in court in November 2022. ” , Judge Kathaleen St. McCormick of the Court of Delaware said in the announcement.

Accordingly, Elon Musk’s side said that it would buy back Twitter at the price of 54.20 USD / 1 share as originally offered and ” the lenders are working to close the deal on or around the 28th of February. 10 “.

However, the Twitter side expressed doubts about Elon Musk’s move. ” For months Musk has been trying to get out of the deal and now, before the trial, Musk’s side has announced that they intend to close the deal as it was .”

The back-and-forth offers the clearest indication yet that Musk’s financial resources may now be at the heart of the legal pause and closing of the deal. Musk has previously said that he would pay for the acquisition through a mixture of debt commitments from financial institutions, equity financing from investors and with his own assets.

But legal experts have raised concerns that the parties that once committed to the loan may now want to pull out of the deal due to recent changes to the debt market and the decline in the value of media companies. society. Twitter, according to experts, will likely want to maintain the litigation as a pressure on Musk unless he agrees to close the deal with or without the debt.

In short, the question many skeptics now have is: Does Musk really have enough money to buy Twitter right now?

Even the richest man in the world needs financial help because the size of the deal is so large. In April, Musk announced that he had raised $46.5 billion for the deal, which included two letters of commitment for loans from Morgan Stanley and other unnamed financial institutions (one $13 billion and $13 billion). one is 12.5 billion USD, then reduced to 6.25 billion USD). Musk himself also pledged around $21 billion out of pocket to fund the deal and later raised another $7 billion from private investors like Oracle founder Larry Ellison and cryptocurrency exchange Binance.

At this point, there are only 8 days left until the deadline of October 28. However, the parties have not yet made any other move. A week after the trial adjourned, Twitter’s lawyers said that Musk’s team declined to “commit to any specific closing date.”

The company added that a representative from one of the banks set up to lend to Musk on Thursday morning testified that ” Musk has not yet sent them a loan notice nor informed them that he He intends to make the deal to buy Twitter as original, let alone any specific timeline .”

Source: Bloomberg