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Private equity group Thoma Bravo is reportedly mulling a possible Twitter bid after Elon Musk made a $41 billion all-cash offer to buy the company.
According to the New York Post, sources say that Thoma Bravo could be a white knight for Twitter and CEO Parag Argawal.
As the Post reported, if Twitter rejects Musk’s offer, it could see its share price collapse unless it had another option to reveal at the time of a possible rejection.
That’s where a so-called white knight would come in and because of that, Thoma Bravo needs to move quickly, if it were to move forward, to show the Twitter board it has a potentially friendlier alternative, according to the sources.
Typically, the San Francisco- and Chicago-based firm invests in business-to-business software companies and not companies that cater directly to consumers, like Twitter, so it would seem like an odd match.
Thoma Bravo announced in 2020 the closing of a $17.8 billion buyout fund, and through its different vehicles says it has $103 billion in assets under management.
One of the Post’s sources noted that Twitter generates significant cash flow and is not a bad leveraged buyout candidate.
The source said that Thoma Bravo sees potential for the company when it comes to controlling costs and widening profit margins.
Just last month, Thoma Bravo reportedly reached a $10.7 billion buyout agreement to acquire listed Anaplan, a company that makes software modeling for different business outcomes.
The source added that there was a big demand from Thoma Bravo fund investors to co-invest in the deal outside the fund, and many may also co-invest in a much larger Twitter deal.