Elon Musk's Rollercoaster: Twitter, SpaceX and a Borrowed Billion

<p>Last October, Elon Musk did something many of us wouldn't even dare to
contemplate over our morning coffee – he borrowed a cool $1 billion from his
own company, SpaceX, according to the Wall Street Journal. That same month he was
also working to <a href="https://www.financemagnates.com/fintech/breaking-elon-musk-acquires-twitter/" target="_blank" rel="follow" data-article-link="true">acquire Twitter</a>, <a href="https://www.financemagnates.com/cryptocurrency/elon-musk-unveils-new-twitter-logo-causing-crypto-craze/" target="_blank" rel="follow" data-article-link="true">now X</a>, for $44 billion.</p><p>Musk is SpaceX's largest shareholder with a 42% stake and almost 79% of
its voting power as of March this year. Before you start thinking he's just
your average billionaire with a penchant for borrowing money, let's clarify –
he didn't just walk into SpaceX with an IOU scribbled on a napkin. No, this loan
was backed by some of Musk's shares in SpaceX, and, he paid it back with
interest a month later.</p><p>Big numbers and other parties</p><p>But here's where it gets interesting: This borrowed billion was no small
change. SpaceX had $4.7 billion in cash and securities available to it at the
end of last year, as reported by The Wall Street Journal. That $1 billion was a
significant number.</p><p>However, Musk didn't stop there. He also sold huge quantities of Tesla shares around the time of the Twitter deal.</p><p>Even Wall Street got in on the action. Morgan Stanley and Bank of
America chipped in with around $13 billion to help fund Musk's Twitter
ambitions, all backed by a slice of Musk's holdings in Tesla. </p><p>Pay back and falling value</p><p>Now, here's the twist: it's Twitter, not Musk, that's responsible for
paying back those Wall Street loans, complete with a yearly interest bill
that's roughly $1.5 billion.</p><p>Fidelity, the name many Americans might associate with their retirement
fund, has been a bit of a buzzkill, repeatedly slashing Twitter's estimated
value. In May, they said it's worth just a third of what Musk originally paid.</p><p>What’s more, this isn't Musk's first SpaceX loan. Back in 2009, he
casually borrowed $20 million from the company to help fuel the Tesla
revolution. Fast forward to 2021, and he took out not one, not two, but three
loans from SpaceX, each worth $500 million. He did, however, pay them back in
full by year's end.</p><p>As for SpaceX, they're keeping their cards close to their chest and
haven't chimed in on this financial escapade, if they do, you'll read about it <a href="https://www.financemagnates.com/" target="_blank" rel="follow">here</a>.</p>

This article was written by Louis Parks at www.financemagnates.com.