Elon Musk’s plans to transform Twitter, which was agreed to be purchased on April 25 for $44 billion, appear to go beyond cutting staff or launching some paid features. According to the wall street journalthe tycoon would have considered making twitter public again just three years after acquiring the company.
The aforementioned media, which mentions sources familiar with the matter, assures that Elon Musk is talking with private equity funds to get that $21 trillion that he himself had undertaken to contribute out of his own pocket to the purchase of the company. And it is that, although Musk is currently the richest man in the world, he barely has around 3,000 million dollars in cash. Several options have been proposed with which the CEO of Tesla and SpaceX could obtain sufficient funding to pay this abysmal difference. Among them, finding co-investors or even selling Tesla shares. However, the most viable option seems to be to approach investment funds.
Elon Musk must, however, guarantee investors the profitability of the purchase. Selling Twitter through a public offering of shares as a means of earning income in the future, this seems to be the most suitable option. The tycoon, remember, also offered bankers to make money with Twitter by laying off employees or creating subscription services on the platform itself, which would help boost recurring revenue.
Is three years enough to make Twitter public again?
It is unclear whether three years is enough to make Twitter public again. Especially if we take into account that a private equity firm can take up to five years to restructure a company for it to become public again, according to WSJ. Elon Musk’s plans for Twitter are also quite ambitious and go far beyond the long-awaited button to edit tweets.
The tycoon promised to make the platform a place where “freedom of expression” reigns. Mainly, allowing any speech and providing greater transparency when it comes to showing how the social network’s algorithm filters content. It also plans to crack down on bots by implementing a human account verification system, along with multiple additional platform features and a few corporate changes.
Elon Musk, however, does not appear to have entered into an agreement with an investment firm to obtain the cash which he himself must provide for the purchase of the social network. In fact, and as stated Reutersthe tycoon could only analyze all the options that allow him to definitively close the acquisition of Twitter.