Musk To Re-Take Twitter Public At Some Point (Just Like Every Other LBO Investor Would), WSJ Reports

Perhaps this ‘breaking’ news from The Wall Street Journal should be filed under “well, d’oh!” as they report, according to people familiar with the matter, Elon Musk said he plans to stage an initial public offering of Twitter in as little as three years of buying it.

For anyone who can fog a mirror, this is not exactly earth-shattering news as it is the goal of every LBO manager to re-spawn the company (after ‘fixing’ it) at a hopefuly higher valuation at some point in the future (in the hope that the debt load engaged to enable the LBO does not swamp any cashflows before that).

And that incentive is high for Musk, who is personally invested (though he is reportedly seeking help with ‘other people’s money’ with some of the equity tranche), and as the following chart shows, his acquisition of Twitter, worth approximately $44 billion, is one of the largest leveraged buyouts in history.

You will find more infographics at Statista

WSJ could not resist but take a shot at the ‘free speech absolutist’ as they note nonchalantly that ‘Mr. Musk has a history of missing his timelines’.

However, there is one notable implication of this ‘news. If Musk is planning to IPO in such a relatively short time-frame, it means he can’t simply allow advertising sales to fall off a cliff (or nobody will want to invest when IPO roadshow time comes around). This means that, in theory, there is likely to be considerably more continuity than free-speech-hating-liberals fear.

Which fits with his perspective that he is likely to upset the ‘far-right’ as much as the ‘far-left’ with a more inclusive approach to the ‘town square’.

For Twitter to deserve public trust, it must be politically neutral, which effectively means upsetting the far right and the far left equally

— Elon Musk (@elonmusk) April 27, 2022