Sunday, June 26, 2022

Elon Musk’s SpaceX possibly selling shares to finance Twitter bid: Sources

SpaceX plans to sell existing shares to a select group of buyers starting Tuesday and there is speculation Elon Musk is a seller, The Post has learned.

Musk is trying to raise more money for his $44 billion Twitter bid and is not only facing difficult times but is also finding it costly, sources close to the situation said.

The billionaire could sell shares of SpaceX to help with the acquisition. As of August, the Tesla tycoon owned 44 percent of SpaceX shares, according to federal filings.

The tender offer is for existing shares and not for new stocks, a private placement source close to the position told The Post.

The Musk-controlled company last raised $337 million in December at a $100 billion valuation.

This time, the private placement source said, SpaceX is going to seek $70 per share — a 25 percent increase from its previous round, which was followed by a 10 to 1 stock split — equivalent to a valuation of about $125 billion.

Read Also:  Lack of shipping containers is changing what appears on the shelves

Meanwhile, Musk is scrambling to raise more money for his Twitter bid.

He is talking to private equity firms, including Apollo Global Management and hedge funds, to convert his margin debt against Tesla to $4 billion from $2 billion in preferred financing, and some of Morgan Stanley’s junior financing. They have already made arrangements for the replacement too, said a banking source.

SpaceX has launched 19 rockets this year, carrying 53 satellites for its Starlink network, which provides Internet access in under-served areas of the world, including war-torn Ukraine.
zumapress.com

Tesla shares have risen since Musk announced his purchase of Twitter last month. The stock closed Monday at $724.37 after hovering near $1,000 when the deal was announced on April 25.

Morgan Stanley has committed to lending Twitter a $3 billion junior loan, the banking source said, adding that the 12 percent interest rate on Twitter could be too high.

Read Also:  First NIL draft class could have long-lasting impact on the NFL

Musk’s tweet on Friday raised questions about Twitter’s reporting of its user base that debt financing is not going to be easing, lending sources said.

“Now it will be very difficult to sell the loan as he has questioned Twitter’s user base,” the banker said. “That’s undermining their finances.”

On Monday afternoon, Musk said a viable deal to buy Twitter for less than the $54.20 price he had agreed to pay on April 25 wouldn’t be out of the question.

SpaceX has reportedly had several successful launches in recent months.

This year, it launched 19 rockets — including one Friday — that carried 53 satellites for its Starlink network, which provides Internet access in unserved regions of the world, including war-torn Ukraine.

Last year, there were only 31 launches.

SpaceX says it will beat NASA in reaching Mars this decade.

,

Nation World News Desk
Nation World News Deskhttps://nationworldnews.com
Nation World News is the fastest emerging news website covering all the latest news, world’s top stories, science news entertainment sports cricket’s latest discoveries, new technology gadgets, politics news, and more.
Latest news
Related news
- Advertisement -