Emily MartinezIn a perplexing financial move, Elon Musk reportedly secured a $1 billion loan from SpaceX in October, the same month he assumed control of Twitter, rebranded as “X,” as revealed in documents cited by The Wall Street Journal.
This loan was collateralized by some of Musk’s shares in SpaceX and was promptly repaid with interest in November, according to the Journal’s findings. However, it left many questioning the implications for SpaceX’s financial stability, considering the company held $4.7 billion in cash and securities at the close of the previous year.
Notably, Musk also offloaded nearly $4 billion worth of Tesla stock in November. In total, he divested approximately $23 billion in Tesla shares in 2022 to finance his Twitter acquisition. A significant portion of the $44 billion Twitter deal was financed by Wall Street banks like Morgan Stanley and Bank of America, with loans backed by Musk’s Tesla stock. These loans are presently being repaid by Twitter, incurring interest payments of around $1.5 billion annually.
Fidelity, a Twitter stakeholder, has consistently devalued the platform, estimating its worth at just a third of Musk’s initial purchase price in May.
This isn’t the first time Musk has turned to SpaceX for financial support. He previously disclosed borrowing $20 million from the company in 2009 to aid Tesla’s funding. The Journal’s latest revelation also indicates that between 2018 and 2020, Musk secured three loans totaling $500 million from SpaceX, all of which were repaid by the end of 2021.
Michelle Thompson
