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News

Elon Musk Receives $1.3 Billion From Crypto Friends To Support The Twitter Deal.

May 7, 2022 - Around 3 mins mins to read

According to a filing with the Securities and Exchange Commission on May 4th, 18 companies have agreed to contribute $7.139 billion to Elon Musk’s acquisition of Twitter. When an individual or group buys more than 5% of a company’s stock, they must file a Schedule 13D with the Securities and Exchange Commission.

Elon Musk Receives $1.3 Billion From Crypto Friends To Support The Twitter Deal.
Source: FT.montage/Reuters

According to the filing, Twitter has already received commitment letters from equity investors in connection with the proposed $44 billion acquisition of Twitter. Binance was the lone cryptocurrency exchange on the list of investors, with a $500 million equity commitment. Sequoia Capital and Fidelity Management & Research Company LLC, both venture capital organizations, placed aside $800 million and $316.1 million, respectively, in the crypto business.

Andreessen Horowitz (a16z), a division of AH Capital Management, L.L.C., has also pledged $400 million to the cause, joining a list of other traditional venture capital firms.

In addition, Saudi Arabia’s Prince Al Waleed bin Talal, a prominent Twitter shareholder, committed to buy 34.94 million shares “at or shortly before the Merger’s closure.”

Morgan Stanley, which had previously agreed to lend a loan of around $12.5 billion to fund the purchase, lowered the loan to about $6.25 billion, despite not being mentioned among investors.

Binance CEO Changpeng Zhao (“CZ”), an outspoken supporter of free expression on Twitter, praised the funding as a “little contribution to the cause” following the announcement.

Elon Musk Receives $1.3 Billion From Crypto Friends To Support The Twitter Deal.
Elon Musk Receives $1.3 Billion From Crypto Friends To Support The Twitter Deal.

Elon Musk, who has been a vocal critic of Twitter’s censoring and spambot issues, initially expressed interest in acquiring the social media giant by purchasing a 9.2% share in April. Later, the Tesla CEO offered to buy the platform, but Twitter’s board of directors rejected him with a “poison pill.” On April 25, he got the green light after offering to buy the platform for $54.20 a share.

Musk should “privatize it, issue a token, and decentralize it,” according to CZ of Binance. Musk should also prioritize putting a stop to spam and scams on the network.

Elon Musk’s acquisition has received support from former Twitter CEO Jack Dorsey, as well as billionaire entrepreneur Mark Cuban, who has proposed an interesting method to screen out spammers using DOGE.

Elon Musk is apparently intending to take over as interim CEO of Twitter for several months after the deal is completed, according to CNBC, which cited sources.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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