Nearly two years after Elon Musk’s acquisition, X’s business is still struggling to climb out of the deep hole it fell into under his ownership.
The $13 billion that Elon Musk borrowed to buy Twitter has turned into the worst merger-finance deal for banks since the 2008-09 financial crisis.
The seven banks involved in the deal, including Morgan Stanley and Bank of America, lent the money to the billionaire’s holding company to take the social-media platform, now named X, private in October 2022. Banks that provide loans for takeovers generally sell the debt quickly to other investors to get it off their balance sheets, making money on fees.
Good fuck em. As if they totally havent made back any loss in recent years
At the time, Musk himself had complained that the price for Twitter was too high, but he decided to go ahead with the deal after waffling over it for a while.
Mmmmmmmmm that’s not how I’d describe it, Marketwatch.
Guess they didn’t want to say that Musk shit posted so hard that he ended up being forced to buy the company.
Guess the saying is true, if you owe the bank $1000, that’s your problem. If you owe the bank $13 billion, its the bank’s problem.
Morgan Stanley has another problem right now too as Their
CEOChairman is missing in that yacht sinkingWe were due for our yearly billionaire offering to Poseidon.
May the god of water take mercy on us with this wealthy sacrifice and place a harvest in our nets
And hold back sea level rise!
I would think that would be the god of Antarctica’s bailiwick.
I don’t think one is enough to placate Poseidon.
Either that or Jörmungandr has aquired a taste for richness. As a man who likes cheesecake I can respect it.
My most requested recipe is: New York Style Cheesecake Stuffed, Chocolate covered, graham cracker rolled, strawberries.
That sounds great minus the strawberries, add more chocolate instead.
The strawberries make it a “healthy dessert.”
Bite me I want more chocolate, also if it can give me cavities it prolly aint healthy.
You probably don’t taste as good as the cheesecake and strawberries. I’ll bite them, thanks. Cheers m8 :)
This one is extra sweet to me as Morgan Stanley stole $4k of my funds, claiming it was abandoned when they never once sent me a message, notification on their site, letter, or call. It took me several months to get it back. All the while I was unemployed and really needed that money.
CEO or chairman?
Ah yea you’re right. Chairman but what’s the difference
Sounds like he found out what’s behind the implications.
Thats crazy I used IDOL for a decade. Good riddance.
“since the financial crisis” - You’ll have to be more specific than that 🥲
No single human should have this much control over our economy.
Isn’t the difference here that Musk has a tremendous amount of assets in the form of Tesla stock that can be used to repay the debt? It’s not like he can declare bankruptcy and stiff them on the bill.
The thing is, selling off the amount of Tesla stock that he’d need to to pay off the debt would cause Tesla stock to plummet, leaving him significantly less wealthy and putting Tesla in danger. So even though he technically has the money to pay them, he functionally doesn’t.
He both technically and functionally does have the ability to repay them, which he will find out soon if he doesn’t restructure the debt, and implying this is in anyway similar to the financial crisis is absurd clickbait.
It could possibly tank Tesla and make Elon less rich if he had to pay his debt. Oh no. As if Tesla being valued at more than 9 major other automakers combined isn’t outlandish in the first place.
But won’t someone please think of the oligarch and his shareholders! 🙄
This is so spot on.
Him being kicked out of the billionaire club would be a net gain for humanity
No debt holder is obliged to consider the reprecussions of collecting their debt, just look at house foreclosure. The wellbeing of a thrid party company has no bearing on the ability to pay back a debt, and there are stock sell off plans that facilitate large liquidation over a period of time to ameliorate the stock price drop and prevent it from a full crash. Anyone who tells you otherwise is simply licking billionaire boots.
The person you’re responding to is literally arguing that Elon can’t “functionally” pay the debt because it would make him less rich and lower Tesla’s share price.
Their breath smells like Italian leather.
“Rich Corinthian leather”
If you think for one minute I like Elon Musk, I invite you to check out all the negative articles, including this one, that I’ve posted about that piece of shit. I’d love for him to lose every red cent he’s got. I’ve hated him since before it was cool.
Of course he can, it would just inconvenience him.
Does he seem for even a split second like someone who can handle being temporarily inconvenienced?
Fair enough😂
Oh, so he gets to be treated like the rest of us now…right?
If I stopped paying my mortgage, regardless of how bad off I may be, the bank is taking my house.
Guess he should’ve been more responsible, not eaten avocado toast, and saved more or whatever the fuck conservatives say to struggling millennials and younger folks.
Does the stock necessarily get liquidated for these sorts of transactions though?
Obviously if I owe the bank $100, they will want that in cash, not in $SPY or whatever. But for the Twitter levels of debt could stock just be transferred without being sold first? (Not a rhetorical question, I don’t know how this works.)
I’m guessing here, I don’t think Musk, the person, took out the loans, I think xitter did. So if xitter defaults, Musk’s assets aren’t on the line.
Edit for clarity: ‘leveraged buyout with debt reassignment post acquisition’
I’m pretty sure they lent him $12B and he largely put up the remaining $30B.
Xitter may have taken in more loans after Elon’s take over. But a company can’t borrow money to buy itself. So yea his assets are very much on the line. I wonder what deal he struck with the Saudi lenders.
Pretty sure they can. It’s how a lot of private equity firms finance their purchases. Also the reason that Toys R Us went under. They were doing fine except the massive loan payments they had to pay. Those loans financed the companies’ buyout.
No Musk had to take the loans out in order to buy Twitter and turn it into the shit hole that is xitter. Now whether or not they are personal loans or he bought them under another company he owns, that’s a different question.
Sounds like a they problem.
Yep, if you own a bank 10 thousand dollars, thats a you problem. If you owe a band 10 billion dollars, thats a them problem.
They are too big to fail?
Marketwatch link that isn’t paywalled:
I can see a very real scenario where Drump gets elected, appoints Moron Musk as treasury secretary, and magically wipes off his Xitter debt never to be heard again
I’d say he can’t do that (the debt part) but apparently the US supreme court thinks a president can do whatever the fuck they want, so who knows at this point.
okay but he blames advertisers for ruining the company
Narcissists will never blame themselves for their screw ups.
Morgan Stanley and BOA will find ever bigger suckers to sell those loans to once they’ve had a chance to repackage them.
It is long past time we got over our child-like worship of billionaires.
We’ll never get over our worship of them, because it is engineered.
The media machines they own, including every market news site, fills every stream with deceptive articles of the 8 things billionaires do that made them rich and the 7 the plebs do that stop them from being billionaires, constantly defying them while shaming you for not being like or serving them better.
The natural state for any society where the elites live large while the masses struggle to survive is to DESPISE the elites, whether violent recourse would be suicide or not.
The love/deification for our elites by many of those they oppress is part of their engineered propaganda to keep it that way with their bully pulpit artificially, and that pulpit is more than loud enough to drown out and ruin the credibility of any prominent voices of reason. Easier for them to maintain the market capitalist machine like this than through overt slavery, they just convince the masses it’s in their interests to self-enslave.
OP did you forget to link the article?
Huh, that’s strange. Let me put it up now; thanks!
Cheers!
Needed to unpaywall it, so here’s an archive link for anyone who needs the same: https://archive.is/hokvj
Edit: hmm there isn’t actually much more there
that is awesome
This is why I stick with credit unions.
