Sunday, July 21, 2024
33 C
Brunei Town

Wall Street, tech investors back Musk Twitter bid with USD7B

AP – Elon Musk has strengthened the equity stake in his USD44 billion offer to buy Twitter with commitments of more than USD7 billion from a diverse group of investors including Silicon Valley heavy hitters like Oracle co-founder Larry Ellison.

A regulatory filing on Thursday also said that Musk is in talks with others for additional funding, including former Twitter CEO Jack Dorsey, the social media platform’s second-largest individual stakeholder after Musk.

Ellison, who is also a board member of electric vehicle maker Tesla, is making the biggest contribution, pegged at USD1 billion. Musk is Tesla’s CEO and biggest shareholder.

Other investors include tech investor Sequoia Capital Fund, which pledged USD800 million, and VyCapital, which committed to USD700 million, according to the filing with the United States (US) Securities and Exchange Commission.

Also, Saudi Prince Alwaleed bin Talal bin Abdulaziz Alsaud has pledged 35 million Twitter shares, according to the filing. The 18 investors are a “who’s who” list of Wall Street and Silicon Valley investment firms, said Wedbush analyst Dan Ives, who follows Twitter and Tesla.

The Twitter headquarters in San Francisco. PHOTO: AP

Before Thursday’s announcement, Ives gave the deal a 75 per cent chance of closing, but now it’s 90 per cent or 95 per cent, he said.

The high profile investors show “that it’s not Musk single-handedly trying to turn around Twitter,” Ives said.

Other investors backing Musk are technology venture capitalist Ben Horowitz, who said his firm, known as Andreessen Horowitz, or a16z, is putting in USD400 million because it believes in Musk’s “brilliance to finally make it what it was meant to be”.

“While Twitter has great promise as a public square, it suffers from a myriad of difficult issues ranging from bots to abuse to censorship,” Horowitz tweeted on Thursday. “Being a public company solely reliant on an advertising business model exacerbates all of these.”

Sequoia has invested in Zoom, DoorDash, Apple, Netflix and others. “We help the daring build legendary companies”, is a headline on its website. The firm has a long history with Musk. It was an early investor in what would become PayPal, which Musk co-founded and was sold for USD1.5 billion in 2002.