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.

  • @Laser@feddit.org
    1•3 months ago

    If not only Musk but also the banks are stuck in this problem, it’s their own fault and incovenience. Not sure why you ignored his completely verbose explanation of how this problem is only Musk’s (and maybe the banks he made the deal with).

    That’s the thing, the banks fear it will be their problem. They don’t care about Tesla as a third party, but themselves.

    I’d love Musk to get fucked by this whole ordeal. This was rather about if the creditors allow it or of they’re afraid of the fallout.

    And you’re right, it won’t be all instantly sold, but it is a large amount of shares and I’d think it would have a negative impact on share price.

    • @Eximius@lemmy.world
      1•3 months ago

      I guess it’s possible. But to me it sounds too much like an extra conspiracy. The banks could just sell off the stock (give zero fucks about other banks), and then force Musk to liquidate.

    • SwayEnglish
      1•3 months ago

      So, if his divestment of such a large amount shares in either company would have a negative impact on stock price, wouldn’t the other share holders have a say in the matter? They typically frown upon someone acting in a manner that will devalue their share prices. I’m honestly asking bc I don’t know the ins and outs, but I would assume that if Elon were to just try and sell shares to pay off his problem the pitch forks are going to come out from other share holders.

      Also, wouldn’t the banks potentially be in a conflict of interest? Presumably those institutions who gave him the loans have invested clients money into those stocks potentially? Again, just asking the question, bc this seems like a major boondoggle that could really fuck over a lot of people in a variety of ways.