Twitter makes first interest payment on Musk buyout debt
1 min read . Updated: 31 Jan 2023, 12:27 AM IST
PremiumTwitter paid a group of seven banks, led by Morgan Stanley, which became stuck with the debt after they were unable to sell it to outside investors
Twitter Inc. made its first interest payment under Elon Musk, according to people with knowledge of the matter, after the billionaire took the social media company private last year using about $12.5 billion of debt.
Twitter paid a group of seven banks, led by Morgan Stanley, which became stuck with the debt after they were unable to sell it to outside investors.
Representatives for Morgan Stanley and Musk did not immediately respond to requests for comment.
The first coupon was expected to cost Twitter roughly $300 million, according to Bloomberg calculations and market participants not involved in the Twitter deal. The payment was due around Jan. 27, about three months after the transaction closed.
Twitter’s debt includes a $6.5 billion loan that banks originally hoped to sell to institutional investors and $6 billion of bridge loans, split equally between a secured and unsecured tranche, that banks had planned to sell in the form of junk bonds.
Musk said in a late December Twitter Spaces conversation that the company has about $1 billion in cash on its balance sheet. But he’s also openly floated the idea of bankruptcy, cited a “massive drop" in revenue as some advertisers fled from the platform, and slashed staff since closing his $44 billion leveraged buyout at the end of October.
This story has been published from a wire agency feed without modifications to the text.
