- Elon Musk's bid for Twitter got more serious on Thursday after the billionaire made a new SEC filing.
- The filing showed that Musk has received commitment letters from several banks to fund his proposed takeover of the social media company.
- Musk could be on the hook for $1 billion in annual interest payments if he succeeds in his tender offer for Twitter.
Elon Musk's proposed bid for Twitter got a lot more serious on Thursday, and if successful the deal could cost Musk about $1 billion in annual interest payments.
In a filing made with the SEC on Thursday, Musk revealed that he has received several commitment letters from banks to fund his proposed takeover of Twitter. As it turns out, taking on billions of dollars in debt costs a lot in annual interest payments.
While Musk plans to fund nearly half of the deal with his own cash, he also plans to utilize a mix of debt and lines of credit to raise the funds necessary to buy every outstanding Twitter share he doesn't own for $54.20 per share.
According to the filing, Musk has received a letter of commitment from banks that have offered to lend him $13 billion to Twitter if he buys the company, with a mix of secured bank loans and junk bonds. Additionally, Musk has received a letter from his banks offering to lend him an additional $12.5 billion for the takeover effort, which would be secured by $62.5 billion worth of his Tesla stock, or about one-third of his stake.