Twitter stated that it has not yet borrowed against this credit line.
On October 23, according to foreign media reports, following last month's revelation by the New York Post that Twitter planned to borrow $1 billion before its IPO, Twitter announced in a revised prospectus today that the company has obtained a $1 billion credit line through its IPO underwriters.
However, Twitter stated that it has not yet borrowed against this credit line. The New York Post had commented that borrowing funds before going public means that Twitter wants to avoid having to return to the capital market for financing after its IPO. Many companies have adopted such strategies before going public. Facebook raised $8 billion before its IPO, and social gaming company Zynga raised approximately $1 billion.
Reuters reported that Goldman Sachs, Morgan Stanley, JPMorgan Chase, Bank of America Merrill Lynch, and Deutsche Bank all participated in this credit transaction, and these banks also concurrently served as underwriters for Twitter's IPO.
In addition to obtaining a $1 billion credit line, Twitter also disclosed in its prospectus that MoPub, the digital ad exchange market it acquired in September, generated $6.5 million in revenue in the first six months of this year but incurred a loss of $2.8 million. Twitter spent $350 million to acquire MoPub, making it the largest acquisition by the company to date.
Early this month, Twitter filed a prospectus with the U.S. Securities and Exchange Commission (SEC), announcing that it would conduct an Initial Public Offering (IPO) on the New York Stock Exchange, with a maximum fundraising target of $1 billion. The IPO date has not been announced, but financial intelligence company PrivCo inferred from Twitter's S-1 filing submitted to the U.S. Securities and Exchange Commission (SEC) that the Twitter IPO date would be November 15, 2013.