Twitter plans to pay 300 million next week to repay

Twitter plans to pay $300 million next week to repay the deal with Elon Musk

At the end of October, Elon Musk became the nominal owner of Twitter, but the funds belonging to him and other investors did not fully cover the value of the social network’s assets, so the company had to take out a loan of $ 12.5 billion at a rather high interest rate . She is due to make her first $300 million loan payment next week.

    Image source: Reuters, Carlos Barria

Image source: Reuters, Carlos Barria

In December, Elon Musk confirmed that Twitter has about $1 billion in accounts, giving the company enough funds to make the first loan payment despite these considerations. Estimated BloombergA group of creditors led by Morgan Stanley has every reason to receive the first payment of $300 million next Friday, January 27th. Without knowing the terms of the loan agreement with Twitter, it’s difficult to assess whether there is a 30-month grace period when there are valid reasons for doing so.

According to indirect data, Elon Musk now personally owns about 79% of Twitter’s fortune, he spent more than $20 billion buying them last year, but their current value is unlikely to exceed $11.6 billion – with others Words, if the billionaire threatens to go bankrupt proceedings, it will lose a significant amount. His current total net worth is estimated at $137.4 billion. It is not in Musk’s interest to force Twitter into bankruptcy, and he has tried to prove through his actions over the past few weeks that he is trying to avoid it.

Musk sold $3.6 billion worth of Tesla stock last month, admitting the money may be needed to support Twitter. It’s hard to say if he’ll use at least part of that amount to buy back Twitter’s debt obligations to lower the interest rate. The lenders aren’t interested in such a deal, having lost $4 billion in profits due to the debt market crisis, which prevented them from reselling Twitter’s debt to other investors. The company also has access to a $500 million revolving credit facility that it can use to cover defaults, including repayments to creditors.

Insider issue this week specifiedthat Twitter will lay off another 50 employees in the product area in the near future, although Elon Musk already declared his willingness to refrain from further job cuts at the end of last year. With fresh potential layoffs, the social network’s headcount could drop below 2,000.

About the author

Robbie Elmers

Robbie Elmers is a staff writer for Tech News Space, covering software, applications and services.

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