Elon Musk says he will rein in Twitter pay, make money from tweets
Musk plans to monetize tweets that contain important information or that go viral.
Elon Musk told banks that agreed to help fund his acquisition of Twitter that he would crack down on executive and board pay to slash costs while monetizing tweets, according to people familiar with the matter.
Musk – who bought Twitter for $44 billion earlier this week – made the pitch to the lenders as he tried to secure debt for the buyout after submitting his offer to the social media giant on April 14.
His submission of bank commitments was key to Twitter’s board accepting Musk’s “best and final” offer.
Musk had to convince the banks that Twitter brought it enough revenue flow to service the debt he sought. He eventually clinched $13b in loans and a $12.5b margin loan tied to his electric car company Tesla.
He would pay the remainder of the consideration with his own cash.
Sources, on the condition of anonymity, told Reuters that Musk’s pitch to the banks constituted his vision rather than firm commitments and that the exact cost cuts he will pursue remain unclear.
Musk, the world’s richest man, also mentioned plans to develop new features to grow business revenue, including ways to make money from tweets that contain important information or go viral.
The $13b loan is more than seven times Twitter’s 2022 projected earnings.
This was too risky for some banks, who either only participated in the margin loan or entirely opted out, citing Musk’s unpredictability as another reason.