Musk Seeking Twitter Investors... Facing Financial Difficulties After Acquisition

Proposed Twitter Investment at $54.20 per Share... "Musk Likely Did Not Anticipate Profit Decline" Evaluation

Elon Musk, CEO of Tesla [Image source=Yonhap News]

[Asia Economy Reporter Kim Pyeonghwa] Elon Musk, CEO of Tesla, is reportedly seeking new investors to invest in Twitter. Since Musk acquired Twitter last October, there has been speculation that the company might be facing financial difficulties due to a decline in advertising revenue.

According to foreign media including Bloomberg on the 16th (local time), Jared Birchall, an executive at Excession, proposed to potential investors to purchase Twitter's unlisted shares. Excession is Musk CEO's family office. Birchall, a former banker from Morgan Stanley recruited by Musk in 2016, manages Musk's assets.

Birchall reportedly offered investors the same price of $54.20 per share as when Musk CEO acquired Twitter. Previously, Musk CEO took over Twitter through a $44 billion acquisition last October and converted it into a private company. It is expected that the investor recruitment will continue until the end of the year.

Locally, there are predictions that this investor recruitment is related to Twitter's financial situation. After Musk CEO carried out large-scale layoffs following the acquisition, major advertisers, conscious of public opinion, stopped advertising on Twitter. Given Twitter's business structure relies on advertising for 90% of its total revenue, this may have caused difficulties.

Ross Gerber, founder of asset management firm Gerber Kawasaki, who recently disclosed receiving the investment proposal, told foreign media, "(Twitter) is financially struggling and is making investment proposals," adding, "(Musk CEO) seems not to have anticipated such a large decline in revenue."

Bloomberg reported that Twitter's debt recently increased from $1.7 billion to $13 billion. The annual interest payments to be made additionally amount to $1.2 billion.

Meanwhile, contrary to Musk CEO's emphasis on freedom of expression, Twitter recently blocked journalist accounts from major media outlets such as The New York Times (NYT) and CNN. The blocked accounts received notifications stating "Account blocked due to violation of Twitter rules." Twitter did not inform the account owners about the blocking process or details.

This content was produced with the assistance of AI translation services.