A US judge has ordered a halt to Twitter’s lawsuits against Elon Musk on the eve of trial to give the billionaire time to finance his takeover of the social media platform, according to a Thursday court filing.

The litigation in the US state of Delaware was halted on Thursday until October 28 to allow Mr Musk, who is chief executive of electric car maker Tesla, to finance the $US44 billion ($A68 billion) deal.

Judge Kathaleen McCormick said if the deal did not close by her deadline the parties were to contact her to schedule a November trial. Mr Musk was scheduled to go to trial on October 17 and his Thursday deposition was postponed by mutual agreement.

Investors appeared to be reassured that the order would end days of confusion about the state of the deal.

Twitter shares, which ended the day down 3.7 per cent, rose 2.7 per cent in after-hours trade.

The world’s richest person said this week he would purchase Twitter at the price he agreed in April, $US54.20 ($A84.36) per share, but conditioned the deal on receiving debt financing.

That marked a reversal for Mr Musk, who spent months locked in litigation with Twitter as he tried to get out of the deal. He claimed Twitter misled him about the number of real users on its platform, among other claims.

Mr Musk said in a Thursday court filing that banks were working cooperatively to fund the deal but that he needed more time, arguing a brief delay was still preferable to the months needed for a trial and appeal.

Twitter said in a court filing the judge should reject the proposal and in an indication of the lack of trust between the parties, said Mr Musk’s plan was “an invitation to further mischief and delay.”

Twitter said Mr Musk should have to close next week. It said a corporate representative for a lending bank testified on Thursday that Mr Musk was yet to send it a borrowing notice and had not communicated that he intended to close.

Major banks that committed to fund $US12.5 billion ($A19.5 billion), or about 28 per cent of the deal, could be facing hefty losses as the swift pace of interest rate hikes has ratcheted up market volatility and dampened appetite for leveraged financing.

“There’s still some uncertainty based on whether or not Elon can find the actual financing to do the deal,” said Randy Frederick, managing director of trading and derivatives for the Schwab Centre.

Mr Musk has raised $US15.4 billion ($A24.0 billion) by selling Tesla shares this year and is leaning on large investors for a chunk of the financing, leading to speculation over whether he will sell more of the electric-vehicle maker’s stock to fund the deal.

“Financing will eventually end up going through one way or another. It is just a point of negotiating terms at this stage,” said Robert Gilliland, managing director at Concenture Wealth Management.

-AAP