American Billionaire Elon Musk took a loan of $1 Billion (roughly Rs. 8,306 crore) from SpaceX around the same time when he was acquiring X, formerly known as Twitter. Musk had later bought X for $44 billion.
SpaceX approved the loan, which was backed by some of Musk's stake in the company, in October 2022. Musk drew all of it down the same month, when he acquired X, according to a report by Wall Street Journal.
According to the report, Musk has agreements with banks to borrow money against the shares of his firms, including electric vehicle manufacturer Tesla, while privately held SpaceX has acted as his lender. The report also stated that Musk's financial condition was further complicated by having to pay for Twitter.
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Elon Musk is SpaceX's largest shareholder with a 42% stake and almost 79% of its voting power, as of March 2023. He also sold a big chunk of his shares in 2022, both before and after the Twitter deal. This brought his total sales to about $40 billion which frustrated investors in the electric vehicles segment.
Tesla had further tightened norms in order to prevent Musk from using his stake to borrow money in April 2023.
Musk’s acquisition of Twitter had also run into serious troubles at this time. The micro-blogging site had threatened a lawsuit against him if he took later than October 27, 2022 to complete the deal. Twitter had charged Musk's legal team with neglecting to deliver draft letters to the Securities and Exchange Commission and a PowerPoint show to the Federal Trade Commission. Fortunately for Musk, the deal went through without further delays and he was able to avoid court action.
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