Musk has pledged to contribute $21 billion in cash for the operation.
The billionaire businessman could use the new financing to reduce its contribution to the principal check for the deal, the sources said.
Musk has also pledged some shares of Tesla Inc to banks to arrange a $12.5 billion loan to help finance the deal, one of the sources said.
Investors such as venture capital firms, hedge funds and high-net-worth individuals are in talks with Musk to provide preferred equity financing for the acquisition, the sources said.
The preferred capital would receive a fixed dividend from Twitter, in the same way that a bond or a loan pays regular interest, but it would also appreciate along with the company’s shares.
Apollo Global Management Inc and Ares Management Corp are among private equity firms that have been in talks to provide the financing, the sources added.
Musk has also started talks with some of Twitter’s top investors about getting them involved in the business rather than selling their shares, one of the sources said.
Former Twitter CEO and current board member Jack Dorsey is considering whether to participate, the source added.
Source: Ambito
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