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.
The losses on banks’ balance sheets from the deal are also biting into potential bonuses for some bankers, the report said.
They should just be fired. This wasn’t a deal that looked like it had good potential but didn’t pan out. It was obviously a bad buy right from the start and the guy who was going to run the private enterprise was both spread too thin to run it well, was increasingly erratic in his behavior, and wasn’t any good at the business he was taking over. Everyone knew it was a bad deal at the time.
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.
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’
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.
Morgan Stanley has another problem right now too as Their
CEOChairman is missing in that yacht sinkingSounds like sacrificed a few billionaires this time.
I hope our watery god is satisfied, if not. I guess we have sacrifice a few more billionaires.
I think we should advertise small boat sailing to Elon, combined with the beauty of the Gibraltar strait area and the manliness of doing it alone.
We can give Poseidon a break and let the orcas have one.
Twist: The Orcas are working for Poseidon.
Yes, but delegation.
