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May 25, 2022, 5:55 p.m. EDT

Elon Musk to rely more on equity to finance his $44 billion Twitter deal

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Rebecca Elliott and Meghan Bobrowsky

Elon Musk plans to rely more heavily on equity to finance his $44 billion deal for Twitter Inc.  amid a sharp decline in Tesla Inc.  /zigman2/quotes/203558040/lastsale TSLA +1.98% stock in recent weeks.

Musk’s funding plan now includes $33.5 billion in equity, up from $27.25 billion, according to a Wednesday regulatory filing. He no longer plans to rely on a margin loan backed by Tesla shares, which are down by about a third since he struck a deal with Twitter in late April.

As of early May, Musk  had lined up about $7.14 billion  from 19 investors whose participation effectively reduces the personal risk Musk has to take to close the $44 billion deal for the social-media company.

The disclosure came soon after Twitter’s chief executive on Wednesday told shareholders the company is proceeding with work on the deal after Musk previously said the deal was “temporarily on hold.”

“We are working through this transaction process,” CEO Parag Agrawal said at Twitter’s annual shareholder gathering. “Even as we work toward closing this transaction, our teams and I remain focused on the important work we do every day.”

The company deferred shareholder questions about the transaction, citing plans for a later gathering at which they would be able to vote on  the deal that was reached last month .

An expanded version of this report appears on WSJ.com.

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