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Elon Musk To Implement ‘Plan B’ To Take Control Of Twitter Within 10 Days: Report

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OPINION: This article may contain commentary which reflects the author's opinion.


Billionaire Elon Musk is not about to sit by and allow Twitter’s board of directors to stop him from taking over the company.

A new report from The New York Post said that the Tesla, SpaceX and Starlink CEO is actively searching for investors to raise around $10 billion in his takeover efforts.

It also said that he is prepared to invest $15 billion of his own money and wants to make his move within 10 days.

The Tesla tycoon — who is worth $270 billion, according to Forbes — is angling to finance his $43 billion bid to acquire Twitter 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, The Post has learned.

Still, insiders say Musk appears to be facing hurdles in raising the money. In addition to doubts about whether Twitter is worth the $54.20 a share that Musk offered on Thursday, sources said some investors appear skittish over his pattern of unpredictable behavior and taste for controversy.

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Musk himself is willing to invest between $10 billion and $15 billion of his own cash to take Twitter private, two sources close to the situation said. That’s up from the current 9.1% stake in the company he revealed on April 4, which is worth about $3.4 billion.

He may even be willing to borrow against his current stake which could bring in several billion dollars.

“The co-investors will combined have more equity than Musk but he will be the biggest single holder,” a source said.

The billionaire has hired Morgan Stanley to help him raise $10 billion in debt to execute a traditional leveraged buyout.

“Private equity firms don’t get paid for headline risk,” a source said, citing the billionaire’s penchant for controversy.

“A lot of private equity firms are doing the work and struggling on the valuation,” another source said. “This is not growing like Instagram or TikTok. You can only raise $10 billion of bank debt, and then maybe some preferred shares. Twitter does not have a whole lot of cash flow.”

In a recent press release, Twitter made it very known that it was doing what it could to stop Musk from completing a hostile takeover.

“Twitter, Inc. (NYSE: TWTR) today announced that its Board of Directors has unanimously adopted a limited duration shareholder rights plan (the “Rights Plan”). The Board adopted the Rights Plan following an unsolicited, non-binding proposal to acquire Twitter,” the statement began.

“The Rights Plan is intended to enable all shareholders to realize the full value of their investment in Twitter. The Rights Plan will reduce the likelihood that any entity, person, or group gains control of Twitter through open market accumulation without paying all shareholders an appropriate control premium or without providing the Board sufficient time to make informed judgments and take actions that are in the best interests of shareholders,” the company said.

“The Rights Plan does not prevent the Board from engaging with parties or accepting an acquisition proposal if the Board believes that it is in the best interests of Twitter and its shareholders. The Rights Plan is similar to other plans adopted by publicly held companies in comparable circumstances,” it said.

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“Under the Rights Plan, the rights will become exercisable if an entity, person or group acquires beneficial ownership of 15% or more of Twitter’s outstanding common stock in a transaction not approved by the Board. In the event that the rights become exercisable due to the triggering ownership threshold being crossed, each right will entitle its holder (other than the person, entity or group triggering the Rights Plan, whose rights will become void and will not be exercisable) to purchase, at the then-current exercise price, additional shares of common stock having a then-current market value of twice the exercise price of the right. The Rights Plan will expire on April 14, 2023,” it said.

But Musk spoke to host Chris Anderson during a TED Talk, and the host asked him if there was a “Plan B” if Twitter says no to his offer.

“There is,” the Tesla, SpaceX and Starlink CEO said.

“Well, I think we would want to err on — if in doubt, let the speech — let it exist. If it’s a gray area, I would say let the tweet exist. But obviously, in a case where there’s perhaps a lot of controversies that you would not want to necessarily promote that tweet, you know. So, I’m not — I’m not saying that I have all the answers here, but I do think that we want to be just very reluctant to delete things and have — just be very cautious with permanent bans. You know, timeouts, I think, are better than sort of permanent bans,” he said.

“But just in general, like it said, it won’t be perfect, but I think we wanted to really have like the perception and reality that speech is as free and reasonably possible, and a good sign as to whether there is free speech is, is someone you don’t like allowed to say something you don’t like? And if that is the case, then we have free speech. And it’s damn annoying when someone you don’t like says something you don’t like. That is a sign of a healthy, functioning free speech situation,” he said.

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