No loans with Tesla shares
Musk changes funding plans for Twitter
5/26/2022 5:34 am
Elon Musk continues to work on the Twitter takeover. However, he will not take out any loans via Tesla shares as security. In order to get the financing, he relies on investors. An important contact should be the longtime Twitter boss Dorsey.
Tech billionaire Elon Musk does not want to take out loans secured with his shares for the planned Twitter takeover after all. Originally, he wanted to get $ 12.5 billion (11.7 billion euros) in this way. However, a statement from the US Securities and Exchange Commission said that Musk wanted to contribute this amount in another way.
The boss of the electric car manufacturer Tesla had presented financing commitments of over 46 billion dollars for the Twitter deal. The waiver of the equity-backed loans was already expected after Tesla’s share price fell significantly. After the switch, Musk plans to contribute $33.5 billion in addition to other loans. In order to raise this amount, he is already bringing various investors on board.
According to the statement, Musk also wants to talk to longtime Twitter boss Jack Dorsey about bringing his shares into a deal to continue to be involved in Twitter after the acquisition is complete. According to the latest information, Dorsey holds around 2.5 percent of Twitter, Musk has bought a good nine percent share in recent months.
Twitter shares rose more than 6 percent in after-hours trading after the announcement. At just under $40, the price was still well below the $54.20 per share that Musk had promised the shareholders. Musk recently declared the deal suspended, but from Twitter’s point of view he cannot decide that unilaterally – and the service insists on the deal.
Twitter pays $150 million to avoid privacy lawsuit
The company is currently in trouble because of data protection allegations. The online service plans to pay $150 million after allegations by the US government that it used users’ phone numbers and email addresses for its advertising platform. Twitter agreed to pay that amount in fines with the FTC and the Department of Justice to settle a lawsuit.
According to the lawsuit, Twitter asked users for their phone numbers and email addresses, saying it would help secure their accounts. Online services access e-mails or messages to mobile phone numbers, for example when you have forgotten your password or to unlock blocked profiles. However, Twitter also used the data to show users personalized advertising.
Between May 2013 and September 2019, more than 140 million users shared their phone numbers or email addresses with Twitter, the US government said. In the service’s approach, she saw a violation of an agreement from 2011, in which Twitter had committed itself, among other things, to transparency in data protection.