Musk will provide an additional $6.25 billion in equity financing for the $44 billion buyout, according to a regulatory filing Wednesday. That’s enough to eliminate the margin loan of the same size, which had already been reduced earlier this month.
The new structure could reduce the risk of the deal for both Musk and his lenders, particularly given the recent slide in Tesla’s stock price. Shares in the EV maker has sunk about 40 percent since Musk first announced his stake in Twitter in early April. An extended slump raised the prospect that he wouldn’t have enough unpledged shares to cover the margin loan.
Musk, Tesla’s co-founder, is still on the hook for coming up with the full $33.5 billion equity component. But he can turn to others for help.
Musk is seeking additional financing commitments, including having discussions with Twitter co-founder Jack Dorsey and other investors about rolling their equity into the private company, according to the latest filing. He already announced earlier this month that he secured $7.1 billion of equity commitments from investors including billionaire Larry Ellison, Sequoia Capital and Binance.