Tesla boss and SpaceX founder Elon Musk does not want to buy Twitter all alone. He is looking for help with financing in Qatar, Dubai and Saudi Arabia, among others.
Elon Musk’s takeover of Twitter is gradually taking shape. It is now also clear: Musk is not buying the social network alone, but has been looking for partners. In a statement to the US Securities and Exchange Commission (SEC), he names 18 investors who together contribute more than 5.2 billion US dollars. In addition, Musk managed to convince the Saudi Prince Al-Walid ibn Talal Al Saud. He wrested the promise from the richest Arab to convert his almost 35 million Twitter shares and to enter the future private company with the equivalent of around 1.9 billion US dollars.
That alone would be a surprising turn of events, given that the Saudi monarch announced Musk’s plan on April 14 publicly criticized and announced that he would decline the offer. Then, on May 5th, it was suddenly called Twitter: “I’m excited to team up with you, my ‘new’ friend Elon Musk. I believe you’ll be an excellent leader for Twitter, advancing and maximizing its great potential. I look forward to our 1.9 billion invest US dollars in the “new” Twitter and accompany you on this exciting journey.”
The prince thus confirms what “CNBC” also heard in parallel from other sources: Elon Musk is apparently supposed to become the head of the company after the takeover is complete. It is not yet clear whether this will be temporary or permanent.
Musk had already made his roughest change requests for Twitter public at the beginning of the negotiations. His most important point was an encouragement of freedom of expression. But if you look at the list of his “new friends”, it raises questions. Here’s a look at the donors.
Prince Alwaleed Bin Talal Alsaud
Walid is the richest Arab. He owned a large piece of Twitter before Elon’s project, and has held shares since 2011. The prince did not respond to a direct question from Musk about press freedom in Saudi Arabia, Walid’s home country. Possibly out of fear, because the Saudi ruler Mohammed bin Salman is accused of ordering the murder of journalist and government critic Jamal Khashoggi. Information about what led to the reconciliation of the two billionaires is not available.
Larry Ellison
Ellison is one of the richest people in the world. He founded the IT group Oracle and invested in Tesla shares early on. The rocketing rise of the electric car maker made Ellison a fortune on top of what he already owned. Larry Ellison is considered a good friend of Musk, in the past the two company founders often visited each other. However, the Oracle founder seems to have a purely financial interest in Twitter; he used his verified account once shortly after registering in 2012. Since then there has been radio silence.
Sequoia Capital
The American venture capital company Sequoia has been an integral part of Silicon Valley since 1972. The company has funded several companies in the past, including Atari, Animoca Brands, FireEye, Yahoo, PayPal, Robinhood, Electronic Arts, YouTube, Meebo, Apple, WhatsApp, Instagram and Google.
Vy Capital
Vy Capital is based in Dubai. Vy was founded by Alexander Tamash. Before he had his own company, Tamash worked at DST, an investment firm owned by Russian oligarch Yuri Borisovich Milner, who, however, had been critical of the Ukraine war and is no longer considered a close confidant of Putin.
Binance & AH Capital Management
Where Musk is, there must be cryptocurrency. Accordingly, the deal is also backed by Binance, the crypto exchange owned by Chinese-Canadian businessman Changpeng Zhao. Also on board are Andreessen Horowitz and Marc Andreessen, both Silicon Valley stalwarts and big names in the cryptocurrency world.
Qatar Holdings
Qatar Holdings is a state investment company of the Emirate of Qatar. It is controlled, among others, by the Al Thani ruling family and CEO Mansoor bin Ebrahim Al Mahmoud. Freedom of speech and freedom of the press are important issues for the country, but not in Musk’s sense. The non-governmental organization Reporters Without Borders is critical of the situation in Qatar. There are also major problems in the country, which will host the World Cup at the end of 2022, when it comes to freedom of expression and assembly.
The remaining donors come from the USA or Canada, where economic interests and the belief in Twitter’s success under Musk’s leadership are likely to play a role. There are no abnormalities among the board members and founders, most of whom have long careers with well-known banks and investment companies such as Citadel or Wells Fargo.
But how Musk intends to combine the economic interests, his grandiose announcements and the sensitivities of his investors from Saudi Arabia, Dubai and Qatar initially remains a mystery. Richard Nieva of Buzzfeed writes: “The funding and the resulting conflicts of interest underscore the difficulties Musk will have in realizing his vision for Twitter.”
According to the letter to the stock exchange supervisory authority, the search for investors is not over yet, so Musk is looking for even more private investors who want to support him in buying Twitter. Among them, for example, Twitter founder Jack Dorsey, who apparently has not yet decided whether he will follow the new path of his former company.
Sources: CNBC, business tech, buzz feed, SEC