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Faber: Seems unlikely anyone will bid against Musk to buy Twitter

 2 years ago
source link: https://www.cnbc.com/2022/04/19/faber-seems-unlikely-musk-will-get-pe-funding-to-buy-twitter.html
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Seems unlikely anyone will bid against Musk to buy Twitter
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VIDEO04:30
Apollo Global Management considering financing a potential Twitter buyout: Sources

It “seems unlikely” anyone else will step in to buy Twitter and take it private, according to CNBC’s David Faber, meaning the social media company either accepts Elon Musk’s bid or nothing happens.

“The more I report, the less I believe there’s anybody else that really could show up here,” Faber said Tuesday on CNBC’s “Squawk on the Street.” Faber and CNBC’s Jim Cramer also agreed that Disney, Salesforce and Snap aren’t interested.

“So, Elon Musk, it’s all yours. You just figure out if you can pay what they want you to pay, which is probably starting with a six,” Faber said. Musk offered to acquire Twitter for $54.20 a share, or about $43 billion.

Though reports have suggested private equity firmThoma Bravo may be interested in a bid for Twitter, Faber said the rates of return “don’t work.” Fellow private equity firm Apollo isn’t interested in joining a private equity consortium to acquire the social media company, according to sources who asked not to be named because the discussions are private.

Faber dismissed reports that said private equity firms like Thoma Bravo could make a bid, saying the interest is “not real,” but just marketing. He reiterated CNBC’s reporting that a massive private equity consortium isn’t likely.

While Musk is considered to be the world’s richest person, much of his assets are tied up in Tesla stock, meaning he’d likely have to either sell stock or borrow money to fund the deal.

“Yeah, he can do it, we know that,” Faber said. “But how’s he going to do it? Is he really going to choose to put that much of his net worth at risk?”

Gordon Haskett Research Advisors analysts wrote in a note Tuesday that The Wall Street Journal report, which first revealed Apollo was considering getting involved in a Twitter deal, “didn’t impress us much, mainly because we’ve assumed most of the usual suspects, Apollo included, are updating their models.”

But the analysts said Apollo could potentially help a firm like Thoma Bravo with its financing, noting it’s “played a similar role on some other Bravo deals.”

Apollo and Thoma Bravo did not immediately respond to CNBC’s requests for comment.

CNBC’s Alex Sherman contributed to this report.

WATCH: Apollo may participate in Twitter deal as lender


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