Elon Musk has secured additional funding to buy Twitter, according to financial filings announced on Wednesday, bringing the billionaire close to completing the high-profile deal.
Tesla’s CEO said in regulatory filings that he increased his personal financing for the acquisition from $27.3 billion to $33.5 billion and took in an additional $6.25 billion in equity financing, reducing the amount of debt the entrepreneur would receive in the $44 billion purchase.
He said in the filing that the world’s richest man is also in talks with shareholders, including former Twitter CEO Jack Dorsey, to seek additional funding commitments to fund the deal.
Musk originally took a $12.5 billion marginal loan in exchange for shares of electric car maker Tesla to help fund his purchase of Twitter. But it cut it to $6.25 billion earlier this month after bringing in co-investors.
The latest filing comes after Musk said last week that his bid to buy Twitter would not go ahead until the company shows evidence that spam bot accounts represent less than 5% of the platform’s total users, a move analysts suggest is aimed at pressuring Twitter to accept a lower selling price. .
Details of Musk’s funding plans were announced to the public on the day Twitter shareholders gathered for their regularly scheduled meetings.
A vote on Musk’s plan to buy the social media platform was not on the agenda, but will take place on a date yet to be determined in the future.
However, shareholders who put proposals to a vote frequently invoked the name of Tesla’s CEO.
Investors at the meeting tentatively approved a proposal from the New York State Joint Retirement Fund that called for a report on Twitter’s policies and procedures on political contributions using corporate money.
Two proposals by conservative-leaning groups failed to garner enough votes to pass them. One called for a review of the “company’s impacts on civil rights and nondiscrimination” and referred to “anti-racism” programs that seek to establish “racial/social justice” as “severely racist”. The other sought more disclosure of the company’s lobbying activities.
Many of the proposals spoke of the deep existential conflict between Twitter users, employees, and contributors.
Twitter co-founder Jack Dorsey’s term as a board member expired on Wednesday. Investors have re-elected Patrick Bechet, General Partner of Inovia Capital, to the Board of Directors.
Investors also blocked the re-election of Musk’s ally to the board of directors, voting against Egon Durban, co-chair of private equity firm Silver Lake, who was involved with Musk in his abandoned bid to make the electric-car maker private.
“The Twitter board has not embraced Elon Musk and his vision for Twitter. So the fact that his ally was removed from the board is not surprising,” said Kim Forrest, chief investment officer at Bouquet Capital Partners in Pittsburgh.
A vote on Durban’s role may signal skepticism among shareholders of Musk’s plan or his willingness to pay what he has offered, but investors are expected to overwhelmingly approve the deal.
Twitter’s board of directors initially voted to adopt “toxic pills” that limited Musk’s ability to increase his stake in the company, but later voted unanimously to accept the takeover offer.
In April, Musk reached a deal to buy Twitter at $54.20 per share. But Tesla’s CEO said in May that the deal could not progress until the platform proves that less than 5% of its users are fake or spam accounts.
Experts said last week that this sharp turn made no sense except as a tactic to thwart or renegotiate a deal that has become costly to him. Having the discussions public, on Twitter no less, adds to the chaos.
Experts say Musk cannot unilaterally suspend the deal. If Musk goes too far, he could be in trouble for a $1 billion breakup fee. Alternatively, Twitter could sue Musk to force him to go through with the deal, although experts believe this is highly unlikely.
Even if shareholders approve the offers, they would be non-binding, said Donna Hitscherich, a professor of finance at Columbia Business School.
Twitter shares jumped about 6% to $39.15 in extended trading.
Musk could not be reached for comment on details of the regulatory findings.