Banks that loaned Elon Musk $ 12.7 billion to buy Twitter don’t expect to be able to pay back their funds quickly, he writes. Financial Times citing their sources.
According to the publication, creditors are preparing to hold debts on their balance sheets at least until the spring of 2023. At the same time, banks have already come to terms with the fact that they may not be able to sell Mr. Musk for many months, and the same loans will eventually turn into severe financial losses for the banks.
Banks are waiting for Elon Musk to present a clear strategy on Twitter for the next few years, including his vision of how the social network will cut costs and increase profits, the sources say. Until then, it will be extremely difficult for investors to sell Mr. Musk’s debt obligations, simultaneously believe seven creditor banks participating in the deal.
The newspaper notes that banks, including Morgan Stanley, Bank of America, Barclays and BNP Paribas, did not attempt to sell Elon Musk’s debt to institutional investors before the transaction was completed, as creditors often do, since the purchase himself was in limbo for several months since – due to disagreements between Mr. Musk and Twitter over the terms of the deal.
Elon Musk closed the Twitter purchase deal on October 27. The transaction amount is $ 44 billion, in a few days, Mr. Musk managed to announce on plans to recover accounts that have been suspended for dubious or minor reasons e create a board content moderation, as well as intention to review the process of verifying accounts in the service. Also, Elon Musk dissolved board of directors of the company, temporarily becoming the sole head of Twitter.
Read more about the agreement – in the material “Elon Musk took over Twitter”.
