Elon Musk Details Plan for $46.5 Billion Twitter Takeover

Elon Musk on Thursday said he had commitments worth $46.5 billion to finance his proposed bid for Twitter and was exploring whether to launch a hostile takeover for the company.

In documents filed with the Securities and Exchange Commission, Mr. Musk said that he was considering whether to take his offer directly to Twitter shareholders — a so-called tender offer — without the consent of Twitter’s board.

Last week, Mr. Musk, the world’s wealthiest man, made an unsolicited offer for the social media company, saying that he wanted to take it private and that he wanted people to be able to speak more freely on the service. His offer was regarded skeptically at the time because he did not include details about how he would come up with the money for the deal.

Offering specific details on his financing could put further pressure on Twitter board’s to take Mr. Musk’s bid seriously.

A spokesman for Twitter confirmed the company had received the updated proposal. “As previously announced and communicated to Mr. Musk directly, the Board is committed to conducting a careful, comprehensive and deliberate review to determine the course of action that it believes is in the best interest of the Company and all Twitter stockholders,” the spokesman said.

Twitter is likely to address Mr. Musk’s bid in more detail when it reports quarterly earnings on April 28.

Mr. Musk’s bid is backed by a mix of debt and cash. The investment bank Morgan Stanley and a group of other lenders are offering up $13 billion in debt financing and another $12.5 billion in loans against Mr. Musk’s Tesla stock. Mr. Musk is expected to add about $21 billion in equity financing.

Shares of Twitter were little changed in early trading on Thursday at around $47, below Mr. Musk’s bid of $54.20 per share, suggesting that investors are still not convinced that a deal will be done at that price.

Mr. Musk said he would continue to review his investment in Twitter, which could mean buying — or selling — more shares. While Twitter’s board has not rejected Mr. Musk’s offer, it has responded with a defensive tactic known as a “poison pill.” If Mr. Musk buys more than 15 percent of the company, Twitter would flood the market with new stock that all shareholders, except Mr. Musk, could buy at a discount. Mr. Musk has built up a stake of more than 9 percent of Twitter, which at one point made him the company’s biggest shareholder.

The poison pill that Twitter announced has a so-called “last look” provision, which would give the company a 10-day window to decide whether to trigger the provision or not, should Mr. Musk cross the 15-percent threshold. It is very rare for a potential acquirer to trigger a poison pill, but Mr. Musk is famously unpredictable.

The 50-year-old billionaire hinted for days that he planned to increase his stake by making a tender offer. In recent days he has tweeted apparent references to his next move in the takeover fight, mentioning the Elvis Presley ballad “Love Me Tender” and the F. Scott Fitzgerald novel “Tender Is the Night.”

Mr. Musk’s habit of tweeting obscure but market-moving information has kept Twitter’s advisers on their toes throughout the takeover saga. They have watched his Twitter account closely as they prepared for the possibility of a hostile bid, two people familiar with the matter told The New York Times.

For Mr. Musk, offering up details about takeover financing could serve as a form of redemption. In 2018, Mr. Musk tried to take Tesla private and tweeted that he had “funding secured,” propelling Tesla shares higher. He did not have financing prepared for such a deal. The S.E.C. later filed a securities fraud lawsuit against him, accusing him of misleading investors. Mr. Musk paid a $20 million fine and agreed to step aside as Tesla’s chairman for three years.

A deal for Twitter, as envisioned by Mr. Musk, would be the largest leveraged buyout in decades.

Kate Conger contributed reporting.