{"id":538729,"date":"2023-01-11T01:24:37","date_gmt":"2023-01-10T22:24:37","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/twitters-debt-and-value-have-plunged-painfully-since-elon-musk-takeover-sources\/"},"modified":"2023-01-11T01:24:37","modified_gmt":"2023-01-10T22:24:37","slug":"twitters-debt-and-value-have-plunged-painfully-since-elon-musk-takeover-sources","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/twitters-debt-and-value-have-plunged-painfully-since-elon-musk-takeover-sources\/","title":{"rendered":"#Twitter&#8217;s debt and value have plunged painfully since Elon Musk takeover: sources"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a413dd35075b\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a413dd35075b\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/twitters-debt-and-value-have-plunged-painfully-since-elon-musk-takeover-sources\/#%E2%80%9CTwitters_debt_and_value_have_plunged_painfully_since_Elon_Musk_takeover_sources%E2%80%9D\" >&#8220;Twitter&#8217;s debt and value have plunged painfully since Elon Musk takeover: sources&#8221;<\/a><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9CTwitters_debt_and_value_have_plunged_painfully_since_Elon_Musk_takeover_sources%E2%80%9D\"><\/span>&#8220;Twitter&#8217;s debt and value have plunged painfully since Elon Musk takeover: sources&#8221;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div>\n<aside class=\"single__inline-module alignleft\">\n        <\/aside>\n<p>Big banks and investors that helped Elon Musk complete his $44 billion takeover of Twitter are taking a bath on their equity stakes and loans to the money-bleeding <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">social media<\/a> site, according to financial filings and sources interviewed by The Post.<\/p>\n<p>Fidelity Investments has been forced to write down the initial stake it took in Twitter \u2014 valued at $19.66 million last October \u2014 to $8.63 million, according to a recent securities filing by Fidelity. <\/p>\n<p>But insiders say the markdown on Twitter\u2019s equity value could be even steeper in reality, with multiple sources noting that the $13 billion Musk borrowed against Twitter to fund the buyout would not even sell for 50 cents on the dollar.<\/p>\n<p>Morgan Stanley led a group that included Bank of America, Mitsubishi, BNP Paribas, Mizuho and Societe <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">General<\/a>e that underwrote the $13 billion loan for the Oct. 27 deal. However, Morgan Stanley has not tried to syndicate the loan because there is a very limited market for the paper and it is well underwater, two well-placed sources said.<\/p>\n<p>\u201cNo one is touching this debt until a new CEO is hired and people can get clarity on the revenues,\u201d one of the sources said.<\/p>\n<p>\u201cI don\u2019t think they can sell it at 50 cents on the dollar if they tried,\u201d said the second source, who is one of the larger buyers of secondary loans.<\/p>\n<p>These loans ought to be marked down by 70% of their value, according to one source who structures leveraged loans and is following the matter. That estimate is far more drastic than the markdown of as much as 20% that <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.reuters.com\/markets\/us\/musks-banks-book-twitter-loan-losses-avoid-big-hits-sources-2022-12-14\/\">Reuters reported Morgan Stanley will take to reflect the present value<\/a> of the loan when the bank reports earnings on Jan. 17.<\/p>\n<p>Morgan Stanley refused to comment when contacted by The Post on Tuesday.<\/p>\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-486.jpg?w=1024\" alt=\"Elon Musk took the reins on Twitter in a $44 billion takeover last year.\" class=\"wp-image-25312731\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-486.jpg?quality=75&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-486.jpg?quality=75&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-486.jpg?quality=75&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Elon Musk took the reins on Twitter in a $44 billion takeover last year.<\/figcaption><figcaption><span class=\"credit\">AP<\/span><\/figcaption><\/figure>\n<p>Interest on the loans is about $1.3 billion a year, The Post previously reported. Debt is senior to equity in the capital structure.<\/p>\n<p>Musk took Twitter private after paying $54.20 a share for the site and is not required to share financials with anyone other than his banks. There is speculation Twitter\u2019s revenue is now on pace over the next 12 months to be $1 billion after reaching $5 billion in 2021, one of the sources said.<\/p>\n<p>Musk has given mixed signals on Twitter\u2019s current worth. In early December, the tech mogul said he was looking to sell stakes in Twitter at the same price he paid, indicating it had not dropped in value. Yet, he tweeted on Dec. 18 that Twitter \u201chas been in the fast lane to bankruptcy since May.\u201d <\/p>\n<p>The lenders believe the possibility of bankruptcy is another reason not to buy Twitter debt, the source.<\/p>\n<p>\u201cWho wants to go against Musk in a restructuring?\u201d one of the lenders said.<\/p>\n<p>Musk has faced significant scrutiny since taking over Twitter \u2014 which has included hundreds of job cuts, clashes with advertisers and an overhaul of the company\u2019s account verification policies. <\/p>\n<p>Half of Twitter\u2019s top 100 advertisers\u00a0ranging from AT&amp;T to Wells Fargo have seemingly stopped advertising on Twitter, according to Media Matters for America.<\/p>\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" loading=\"lazy\" width=\"1024\" height=\"682\" src=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-487.jpg?w=1024\" alt=\"outside Twitter office building \" class=\"wp-image-25312775\" srcset=\"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-487.jpg?quality=75&amp;strip=all&amp;w=1535 1536w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-487.jpg?quality=75&amp;strip=all 1024w, https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-487.jpg?quality=75&amp;strip=all&amp;w=512 512w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\"\/><figcaption>Musk took Twitter private after paying $54.20 a share for the site.<\/figcaption><figcaption><span class=\"credit\">Liz Hafalia\/San Francisco Chronicle via AP<\/span><\/figcaption><\/figure>\n<p>Odeon Capital Group Analyst Dick Bove told The Post that Morgan Stanley has not commented yet on the loan and will likely be asked about it on the earnings call.<\/p>\n<p>He said Morgan Stanley has been very bullish on tech, and that is why they would make what has turned out to be this risky loan.<\/p>\n<p>Bove believes Morgan Stanley should be focusing more attention on natural resources, manufacturing and defense.<\/p>\n<p>\u201cThey are positioned exactly incorrectly for where the economy is moving,\u201d Bove said.\n                        <\/p><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/news\/\" target=\"_blank\" rel=\"noopener\">News category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/nypost.com\/2023\/01\/10\/twitters-debt-and-value-have-plunged-painfully-since-elon-musk-takeover-sources\/\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;Twitter&#8217;s debt and value have plunged painfully since Elon Musk takeover: sources&#8221; Big banks and investors that helped Elon Musk complete his $44 billion takeover of Twitter are taking a bath on their equity stakes and loans to the money-bleeding social media site, according to financial filings and sources interviewed by The Post. Fidelity Investments&#8230;<\/p>\n","protected":false},"author":1,"featured_media":538730,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/nypost.com\/wp-content\/uploads\/sites\/2\/2023\/01\/twitter-equity-worthless-index.jpg?quality=75&strip=all&w=1024","fifu_image_alt":"","footnotes":""},"categories":[70897],"tags":[138291,39394,73711,73986,10401],"class_list":["post-538729","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-1-10-23","tag-elon-musk","tag-investments","tag-morgan-stanley","tag-twitter"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/538729","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=538729"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/538729\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/538730"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=538729"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=538729"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=538729"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}