© Reuters Banks may provide Elon Musk with new margin loans against Tesla stock – report
By Senad Karaahmetovic
Wall Street banks are considering providing Elon Musk, CEO of Tesla (NASDAQ:) and Twitter, with new margin loans to replace older loans he secured to acquire the social media company, according to Bloomberg News.
Musk’s advisers and banks, including Morgan Stanley (NYSE:), are discussing several options to soften the burden of the $13 billion debt Twitter took on. The report added that Twitter is facing annual interest costs of about $1.2B if the current debt structure remains in place.
The focus of talks is on the $3B of unsecured debt, for which the social media company pays 11.75% interest. If Musk agrees to restructure the deal, any new margin loans are likely to be taken against his Tesla holdings.
At this moment, banks that provided Musk with financing aren’t considering offloading any of the debt to institutional investors until the new year, the earliest, as they prefer to see how Musk’s changes are impacting the business fundamentals.
Earlier today, it was reported that Musk’s Twitter considers increasing its Blue product subscription for users paying via Apple’s (NASDAQ:) iPhone app.
Be the first to comment