Elon Musk in Talks to Raise $3 Billion for Twitter's Buyout Debt
The billionaire has also reportedly discussed selling new Twitter shares.
CEO Elon Musk's Twitter is looking to raise up to $3 billion to pay down its current debt of over $13 billion. According to the Wall Street Journal, Musk and his team have spoken with investors about repayment plans. The unsecured portion of the loan package carries the highest interest rate, and Musk reportedly wants to have a deal finalized by the end of this year.
However, some potential investors have raised concerns over Twitter's financial performance, potentially damaging Musk's plans. Banks that had originally issued the debt were not expecting such a high level of risk and have taken on more than $2 billion in other commitments, including term loans and secured debts.
The WSJ reports that lenders have not received formal notice from Musk's team regarding repayment plans. This uncertainty has caused a great deal of concern amongst stakeholders, particularly those who had invested in the company's debt expecting to be able to sell it.
So, there's some uncertainty regarding the future of Twitter and its debt repayment plans. Musk and his team will likely continue to work with investors to reach a feasible solution. Only time will tell if they will succeed in their endeavors or need to find an alternative way to repay their debt. Regardless, Musk may have his work cut out as he attempts to secure a deal by the end of this year.