Kristina Roberts
Not long ago, Elon Musk, the famous billionaire behind Tesla and SpaceX, bought a very well-known app called Twitter. This happened in 2022. He paid a huge amount of money — $44 billion — to buy it. After buying it, he even changed its name to X.
But Elon Musk didn’t pay for the whole deal using his own money. He borrowed a lot of it from some of the biggest banks in the world. This is normal when people or companies buy very expensive things — they take loans from banks and then pay them back slowly.
Recently, news came out that these banks have finally sold the last piece of that big loan to other investors. This means they have moved on and are now done with the money part of Elon Musk’s Twitter deal.
Who were the banks?
Some of the biggest banks involved in this deal were Morgan Stanley, Bank of America, Barclays, and Mitsubishi UFJ. These banks gave Elon Musk a total loan of $13 billion when he wanted to buy Twitter. This loan included different types of borrowing like secured loans (which are safer for the banks), unsecured loans (which are a bit riskier), and something called a “revolving credit facility,” which is like a credit card for big companies.
Now, they have sold the last chunk of this loan, which was $1.2 billion, to other people or companies who are willing to take it. They sold it for 98 cents for every dollar. This means they didn’t get the full value — they got a bit less than what they gave out.
For example, if you lent your friend ₹100, and he gave you ₹98 back, you would lose ₹2. That’s what happened to the banks here. But they didn’t lose a lot — just a little.
Why did the banks do this?
Big banks don’t always want to hold on to loans for a long time. They often sell parts of the loan to others after a deal is done. This is common when the loan is very big or the company is risky. Twitter, now called X, has been going through many changes since Elon Musk bought it. So, some people may see it as a bit risky to keep that loan.
By selling the loan to others, the banks reduce their own risk. They also get their money back (or most of it), which they can now use to lend to someone else.
Also, when banks sell loans at a small discount (like getting 98 cents instead of 100), it shows that people are a little worried about the company — but not too much. If they had sold it for something like 70 cents, that would mean big trouble. But 98 cents? That’s not bad.
What did Elon Musk do with the money?
The $13 billion in loans that Elon Musk got from these banks helped him buy Twitter. He needed this extra money to complete the full $44 billion deal. Without the loans, he might not have been able to buy the company.
Since then, he has made many changes to the app. He even changed its name to “X,” saying he wanted to make it into something bigger — like an all-in-one app where people can chat, shop, make payments, and do much more.
But running a company like Twitter is not easy. It needs to make money through ads and subscriptions. And under Musk’s control, the app has had both good days and bad days.
What does this mean for the banks?
This moment — when the banks sold the final piece of the loan — is important. It means they have finished their role in the Elon Musk-Twitter story. They gave him the money, and now they’ve got most of it back by selling the loan to other investors.
Even though they sold the $1.2 billion loan for less than its full value, it’s not considered a big loss. It’s just a small hit, and in the world of big business and banking, that’s quite normal.
Banks are always trying to manage risk. If they feel a loan might become difficult to handle later, they try to sell it. It’s like passing the hot potato before it gets too hot.
Is this kind of thing common?
Yes, it is. This is how leveraged buyouts work. A leveraged buyout (also called LBO) is when someone buys a company using mostly borrowed money. The banks give out the money first, and then they try to sell parts of the loan to others later. They don’t want to keep all the risk with themselves.
This kind of deal has happened many times in history. For example, back in 2005, there were many big LBOs. One famous deal was when RJR Nabisco was bought in a very expensive takeover. Banks also sold off debt like this back then. So, what happened with Elon Musk’s Twitter deal is actually quite typical in the world of big money.
What did the banks say?
Interestingly, none of the banks have made any comments on this final loan sale. Even X (formerly Twitter) hasn’t said anything about it. Only Bank of America was asked about it, and they refused to reply.
Sometimes, when banks do things like this quietly, it means they just want to finish the deal and move on without attracting too much attention.
