Apollo Global Management and Sixth Street Partners, which were looking to provide financing to Elon Musk earlier this year for his proposed $44 billion (roughly Rs. 3,60,300 crore) buyout of Twitter, are no longer in talks with the billionaire entrepreneur, according to two sources familiar with the matter.

Earlier this year, Apollo was in talks to provide preferred equity financing for the deal, alongside Sixth Street, sources had previously told Reuters.

Apollo, Sixth Street and other investors were looking to commit over $1 billion (roughly Rs. 8,200 crore) in financing for the deal at the time.

Those talks ended months ago around the time Musk started having second thoughts about going through with the deal, the sources cited above said. Musk initially proposed the buyout in April before backtracking in July, and then changing course again this week.

Musk and Twitter are currently attempting to reach an agreement after months of litigation that damaged Twitter’s brand and fed Musk’s reputation for erratic behaviour.

Twitter and Musk did not immediately respond to request for comment, while Apollo and Sixth Street declined to comment.

Musk’s U-turn on buying Twitter could not have come at a worse time for the banks funding a large portion of the $44 billion deal and they could be facing significant losses due to an unfavourable financing environment, Reuters reported on Tuesday.

Musk is expected to provide much of the $44 billion through funds he has raised by selling down his stake in electric vehicle maker Tesla and by leaning on equity financing from large investors, while major banks have committed to provide $12.5 billion (roughly 1,02,300 crore) of debt financing.

© Thomson Reuters 2022