If they don't get bailed out, they'll be forced to liquidize assets to cover their short (buy back the borrowed stock) which will cause the price to skyrocket and for them to lose billions of dollars.

Bailout isn't really a good term for it. Other billionaires are giving Melvin money in exchange for revenue shares. This isn't a gift, it's a purchase. Melvin does a lot of short selling, and has been extremely profitable for the last 6 years. Due to WSB and other investors buying against shorted positions, Melvin is now losing significant amounts of money. Melvin needs money quickly, which means they are more willing to sell revenue shares at a lower price. Billionaires like Steve Cohen see this as a buy-low opportunity. The idea is that Melvin is likely to become profitable again in the future (a decent bet, as WSB will probably not be able to successfully fuck with shorted positions forever). Basically, his hedge fun thinks that it is a profitable decision to invest in this hedge fund.