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Tech Thread

axlsalinger said:
unless it's a deliberate strategy, Twitter will not go bankrupt.
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Going to have one of two choices.

Raise more money (by either taking on additional debt or selling a piece of the company at a drastically reduced valuation) or go bankruptcy.

Their cash bleed is immense right now
 
MindzEye said:
Sure, for 4-5 Billion

Hell of a write down
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well, yeah… he ain’t getting anything near what he paid for…. Unless he lets someone competent take over (which is not as unlikely as people think) and waits it out
 
MindzEye said:
Going to have one of two choices.

Raise more money (by either taking on additional debt or selling a piece of the company at a drastically reduced valuation) or go bankruptcy.

Their cash bleed is immense right now
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There's a lot of Saudi and Qatari money in there, I don't know what they can do right now other than wait. And as far as Elon's investment is concerned, he can afford it ... at least for now. If there's a bankruptcy he will likely be forced out, which I don't think he'll want to do unless he can sell it for $40B. He is bringing in a CEO though.
 
Cherise wins the internet today — over 400 likes with just 40 followers. Zeke is crunching the numbers in awe right now
 
A lot of people are seeing it because Ian has 380,000 followers.

#ThatsHowTwitterWorks
#IDenyThatCherisePostedThatReply
 
axlsalinger said:
There's a lot of Saudi and Qatari money in there, I don't know what they can do right now other than wait.
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My understanding is that that financing broke down like this:

- 13 Billion in bank loans (Morgan Stanley, BOA, Mitsubishi Financial, Barclays and a few others). This is what carries the 1B a year in interest costs. The responsibility for paying these back belongs to twitter and not Elon, so they will have massive impact on his ability to sell the business for anything should he decide to pull the pin at any point. It's a 10-20B company at best with 13B in debt.
- 5.2 Billion from various funds and friends of Elon (Larry Ellison probably the biggest of the bunch), and this includes the known Qatari money.
- The Saudi's didn't put known cash in, but rolled their 35 million existing shares (just under 1.9B) over.
- Elon's original ~4B stake in the company, rolled over.
- 22.5B personally financed by Elon, but there's not a ton known about this other than most of it probably came from recent sales of Tesla stock (about 20B sold recently). There is a ~3B overhang that no one knows where it came from publicly, could definitely be some Saudi or Qatari (or Russian for that matter....) money in here.

Unless the Saudi's & Qatari's are deeeep into that pile of money Elon supposedly put up himself, they're actually not that heavily invested in this. There's also the possibility that the banks involved injected Saudi or Qatari holdings in to get into the debt side of the transaction. But all I can find for direct equity investment is the Saudi rollover of 35 million shares, and 375M from the Qataris. If anything else exists, it's done sneaky.

If they're in on the 13B debt side of this, there's a fuckton that they can do. If they're in sneaky on the Elon side of the equity, who knows what the terms are. Could easily be personal loans using TSLA as collateral.
axlsalinger said:
If there's a bankruptcy he will likely be forced out, which I don't think he'll want to do unless he can sell it for $40B.
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Which is fine, yeah. But the long and the short is that he bought a company that had 330M in cash on hand and his burn rate isn't known exactly, but we can assume that it's fucking ugly. The nicest assessment imo is that he has about 120 days of cash from the purchase date. Eventually, they are going to need more cash which he has options for getting his hands on, but none of them good.

- Debt either loaned by Elon directly or someone else willing to loan the company money
- Equity sale (which would come with a new valuation on the company, which would piss everyone's balance sheets off...they're all using the 44B valuation when showing their twitter share as an asset on their books)
- IPO the bitch...fucking lol.

So in the not so distant future, a choice is going to have to be made there. My bet is that Elon goes in personally as a creditor, but until the burn rate is under control (I see this getting worse, not better) it's good money after bad. This is a company that could easily, easily burn through 2-3+ billion a year if advertisers find the brand distasteful enough.
 
do we know how the bank holds the debt? credit facility or do they have convertible notes? did he leverage the company or himself?
 
mbow30 said:
do we know how the bank holds the debt? credit facility or do they have convertible notes? did he leverage the company or himself?
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Don't know a ton, there's a handful of financial institutions involved. All I'm aware of is that 6.5B of it is leveraged loans (held by the company, not by Musk personally), the other 6.5, I dunno.

As for credit facility or converts, I doubt it. The loans were part of the purchase of the company, so I don't think a credit facility would work (those are typically for floating ongoing costs, no?) and converts I doubt highly. Convert into equity at what valuation? Original purchase? Bank would be taking a fucking bath if this goes...well...where it's gone. Would be better off selling the office furniture at bankruptcy (I assume their debt is secured...)
 
although the money we are talking about is absurd to Elon it’s literally Monopoly money.


at this point it’s just moving around numbers from one column to another. It may as well all be made up.

he could flush the full $44 mill down the toilet and it makes no practical difference.
 
leafman101 said:
although the money we are talking about is absurd to Elon it’s literally Monopoly money.


at this point it’s just moving around numbers from one column to another. It may as well all be made up.

he could flush the full $44 mill down the toilet and it makes no practical difference.
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would be pretty epic tho
 
I appreciate a billionaire that thinks and acts like we live in a simulation. He should blow $44 bill on extravagant shit he doesn’t need. Fuck Bazos and his puny $500 mill yacht.
 
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