With a net worth of $265 billion, Elon Musk has become the richest person in the world last year, leaving Amazon founder Jeff Bezos behind. However, this amount we mentioned includes not only the cash in hand, but also the value of the shares of companies such as SpaceX and Tesla. So, will Elon Musk be able to raise funds for the Twitter purchase?
Elon Musk is determined to buy Twitter!
Last week, Elon Musk announced that he paid $3.3 billion for the purchase of 9.2 percent of Twitter shares and that the transactions were completed. Musk, who directly won a seat on the board of directors, was excluded from the company.
But now Musk has indicated that he wants to be the sole owner of the company, offering to pay an additional $54.20 per share, or $40 billion in total, for the rest of the social media platform. In a letter to Taylor, the current CEO of Twitter said:
Twitter needs to be transformed as a private company. Twitter has tremendous potential. I will unlock it. I will make it a worldwide free speech platform.
But although Musk has offered to pay a hefty sum of money, Twitter seems unlikely to accept less than $73.34, the highest level of share value in the past 52 weeks.
If Elon Musk is serious about his offer, he will need to sell some of his assets. Part of this may be a portion of his 17 percent stake in Tesla and his 40 percent stake in SpaceX. He currently has $2.95 billion in cash.
But the biggest estimation on this issue is that it will borrow money. Because in many countries around the world, the investment made with borrowed money, that is, the loan is not taxed. Moreover, the interest will be a little more than the income it will earn after the purchase. For this reason, it is anticipated that he will buy Twitter by showing his existing shares as collateral for the loan.
What do you think about this issue? Don’t forget to share your feedback with us on the SDN Forum or in the comments!
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