According to recent reports, the managing director of Elon Musk’s family office is reaching out to seek new equity investors for Twitter. Musk is offering shares at the same price he bought the company for, after admitting at the time that he “overpaid.”
Liz Hoffman and Reed Albergotti report for Semafor that the managing director of Elon Musk’s family office, Jared Birchall, has been reaching out to potential investors this week, offering shares of Twitter at the same price that Musk purchased it at in October, $54.20.
Birchall wrote in an email to investors: “Over recent weeks we’ve received numerous inbound requests to invest in Twitter. Accordingly, we are pleased to announce a follow-on equity offering for common shares at the original price and terms, targeting a year-end close.”
Ross Gerber, a Tesla investor who claims to have invested less than $1 million in Musk’s Twitter takeover, confirmed that he was contacted on Thursday about another funding round at the $44 billion valuation. Gerber said that he’s considering it but wants to get a clearer idea of Musk’s plan for the site. “One could argue he has created value or destroyed value at Twitter. It’s hard to tell at this point,” he said.
Twitter took on $13 billion in debt as part of the Musk takeover deal, which will carry annual interest payments of around $1 billion. This is more money than the company’s profits since 2019, and that was before many advertisers fled the platform following Musk’s actions after purchasing the firm.
Bloomberg reporter Matt Levine wrote last year: “The way finance works now is that things are valuable not based on their cash flows but on their proximity to Elon Musk.” It now seems that this claim will be put to the test with Musk’s attempts to get investors to give him cash at a price point he has already admitted he “overpaid” at.
Read more at Semafor here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan
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