Even as Twitter users increased with Elon Musk’s takeover, the tycoon has assured banks that backed his $44B takeovers that he would cut down on jobs and monetize tweets. Musk has promised to come down on board and executive salaries at the microblogging site.
Elon Musk has assured that he would ensure a cut in costs while developing fresh ways to monetize tweets, People in the know have been informed Musk assured lenders even as he secured funding for the deal.
Musk submitted his offer on April 14. The commitments he got from banks and financial institutions were crucial to the board accepting his final offer.
Elon Musk had to assure banks that Twitter had a healthy cash flow, strong enough to facilitate the money he sought from the consortium. He finally secured $13B from the banks and financial institutions that are secured against the microblogging site. Another $12.5B loans is secured against his stock in Tesla Inc. The remainder he has committed to pay from his cash.
Musk Pitched His Vision For Twitter Rather Than Outline Firm Commitments To His Investors
Elon Musk’s offer to the banks dwelled more on his vision for the future of Twitter rather than any commitments. But it remains unclear what exact model of revenue he envisages once he gets full control. The details he will have to fill out later.
What Musk has committed includes his assurance that he would cut back on salaries, starting with the board of directors of Twitter. This could save around $3M. Twitter paid out $630M in stock-based compensation in 2021, a rise of 33% over the previous year, according to their corporate filings.
Musk has also pointed to the gross margin of Twitter, which is much less than other social media sites, including Pinterest and Meta’s Facebook. He contended that it leaves room to run this platform more efficiently.
