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3mo ago

Banks Sell $5.5 Billion of Elon Musk's X Debt as Investor Confidence Rises

The sale marks a significant step for Wall Street banks offloading debt tied to Musk's 2022 acquisition of X, as investor interest grows amid financial improvements and political ties.

'X' logo is seen on the top of the headquarters of the messaging platform X, formerly known as Twitter, in downtown San Francisco, California, U.S., July 30, 2023. REUTERS/Carlos Barria/File Photo
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Overview

  • Wall Street banks, led by Morgan Stanley, sold $5.5 billion of debt tied to Elon Musk's $44 billion acquisition of X (formerly Twitter) in 2022.
  • The debt was sold at 97 cents on the dollar, higher than initial projections of 90-95 cents, offering investors an 11% yield.
  • This marks the second attempt to sell the debt after an earlier effort in 2022 failed due to low bids and advertiser losses on the platform.
  • Investor interest surged following X's improved financials, including $1.2 billion in adjusted EBITDA in 2024, and Musk's growing influence as a close aide to President Trump.
  • Key advertisers like Disney and Apple have returned or are in talks to resume spending on X, signaling renewed confidence in the platform's revenue potential.