Ron Baron, one of Tesla’s largest shareholders and CEO of Baron Capital, suggested Thursday that Musk got a good deal on his Twitter acquisition, after earlier calling the Tesla CEO’s involvement in the company “meaningless.”
In a statement to CNBC’s Becky Quick, Baron said that, after doing two days worth of initial diligence, he felt the plan was interesting.
“My guess 2-3x return or more next 4-5 years if successful,” Baron told Quick. “Purchase price really cheap since business had been so poorly run. Actually incredibly cheap and would have remained that way if Musk had not offered to acquire. In my opinion.”
The comment comes as a new regulatory filing released Thursday showed that Baron Capital subsidiary BAMCO committed $100 million in equity to support Musk’s takeover. Musk secured more than $7 billion in total from a group of investors including BAMCO to support his $44 billion purchase of Twitter, which he plans to take private.
The Baron Capital CEO had earlier shrugged off the importance of Musk’s initial roughly 9% investment in Twitter and accompanying board seat, calling it “tiny” for a man worth hundreds of billions of dollars. Since those comments, Musk reversed course, deciding he’d rather buy Twitter and take it private than sit on the board simply as one of its largest shareholders.
After Twitter’s board accepted Musk’s takeover bid, Securities and Exchange Filings revealed he sold about $8.4 billion in Tesla shares. Musk said he’d secured $25.5 billion of fully committed debt to help fund the Twitter deal, including $12.5 billion in loans against his Tesla stock.
WATCH: Elon Musk lines up $7.2 billion in funding for Twitter takeover
