Binance is the unlikely name on Twitter’s list of newly acquired shareholders. Elon Musk’s buyout of social media group Twitter has attracted $500 million in equity investment from Binance, the world’s largest cryptocurrency exchange. Binance was one of 18 co-investors in Elon Musk’s Twitter purchase, alongside firms such as Sequoia Capital and Fidelity Management & Research Company.
Binance commits $500m in support for Elon Musk
On May 5, Musk filed an amended general statement of the acquisition, stating that Twitter had acquired around $7.2 billion in new financing commitments as part of the merger agreement, subject to the terms of co-investor equity commitment letters.
Binance got cited as one of eight co-investors in the deal, alongside other notable cryptocurrency businesses such as Sequoia Capital Fund and Fidelity Management & Research Company.
The recent entry of a high-profile Tesla CEO into the digital asset market has sparked interest in the sector. Musk is a vocal advocate for cryptocurrencies and has acknowledged his ownership of Bitcoin, Ether, and Dogecoin.
In a retweet of news about the financing, Changpeng Zhao, the creator and CEO of Binance, called it “a small contribution to the cause.” All of the equity investors mentioned in the document have agreed to contribute to or shortly before the acquisition’s completion.
Binance is the fourth-largest investor, having put $500 million into the project. The Lawrence J. Ellison Revocable Trust invested $1 billion, making it the third-largest contributor. Sequoia Capital and VyCapital each contributed $800 million to the project.
Equity Investors have retained an option to satisfy such Equity Investor’s equity commitment with shares of common stock held by such equity investors, valued at $54.20 per share.
The total value of the new commitments, after settlement adjustments, is around $7.139 billion (16.225 percent of what Musk paid for Twitter), according to data provided to SEC.
Elon Musk, the billionaire CEO and founder of Tesla, announced Twitter’s acquisition on April 25, 2022, with a $44 billion value transaction expected to be finalized by 2022, subject to the approval of Twitter stockholders as well as regulators. He previously indicated that one of his top priorities for Twitter would be to eliminate “spam and scam bots,” as well as bot armies linked to crypto.
Elon Musk secures $7bn in funding for Twitter
Elon Musk, the world’s wealthiest individual with a net worth of around $268 billion, bought Twitter for $44 billion in a deal and stock at a price of $54.20 per share. According to the offering letter submitted by Musk to Twitter’s board chairman Bret Taylor, “Twitter has extraordinary potential and I will unlock it.” He also expressed that going private was the only way to guarantee that Twitter could continue to be a symbol of free speech.
According to the revised filing, Elon Musk purportedly reduced the aggregate principal amount of the margin loans secured against his Tesla stock from $12.5 billion to $6.25 billion. It boosted equity financing commitments from $21 billion to $27.5 billion. The remaining funding is said to be comprised of loans secured against Twitter assets.
The news appears to have had a modest impact on Binance’s token, which rose 4.2% on the day. Last year, Tesla CEO Elon Musk was reportedly pressing Binance to address several problems on its platform, resulting in a minor Twitter squabble with the Binance CEO. Musk questioned Zhao about the issue of some stuck Dogecoin (DOGE) withdrawals on Binance, suggesting that he explain it.
Furthermore, the filing revealed that Prince Alwaleed bin Talal, a Saudi Arabian investor who had initially opposed the buyout, instead agreed to roll his $1.89 billion stakes into the deal rather than sell it.
According to the filing, the CEO of Tesla will continue to negotiate with existing Twitter shareholders, including the company’s previous chief Jack Dorsey. He has the second-largest individual stake in the firm and is a board member.
Twitter’s shares have remained below Musk’s per-share offering bid of $54.20 because Wall Street still doubts whether the deal will go through. Shares of the San Francisco social media platform rose 2% before the opening bell to $50.10.
Source: https://www.cryptopolitan.com/binance-pledges-500m-to-musk-for-twitter/