Morgan Stanley and a group of lenders have increased the sale of $3 billion in loans tied to social media platform X.
The platform is intrinsically linked to billionaire Elon Musk, who sat second on the 2024 Forbes Rich List. Due reported last year that there were more billionaires than ever, with Musk’s net worth sitting at a massive $195 billion.
Now lenders such as Morgan Stanley and others, such as Bank of America and Barclays are cashing on Musk’s newfound place at the side of returning President Trump.
X loan sales increased by banks
Musk borrowed a host of funds to acquire the now-flailing social media platform for $44 billion. The banks involved had looked to offset the loans after Musk posted less-than-favorable comments that resulted in companies like Coca-Cola and Disney bidding farewell to the bird.
According to a recent Bloomberg report, these banks are now looking to increase the amount of loans sold. Initially, they had forecast around $3 billion worth of loans to be put up for sale, but now that figure is sitting at a healthy $5.5 billion of loans.
According to sources, the banks had been worried about a considerable loan loss as the probe loomed large from the Securities and Exchange Commission (SEC).
Due reported that the investigating SEC parties had initially pressured Musk on multiple attempts to uncover the truth about the deal behind the 2022 social media platform sale.
An SEC statement said the “testimony subpoena to Musk relates to an ongoing investigation by the SEC regarding, among other things, potential violations of various provisions of the federal securities laws in connection with (a) Musk’s 2022 purchases of Twitter, Inc. (“Twitter”) stock, and (b) Musk’s 2022 statements and SEC filings relating to Twitter. According to the filing, the SEC seeks Musk’s testimony to obtain information not already in the SEC’s possession that is relevant to its legitimate and lawful investigation.”
Musk managed to avoid the SEC’s questions initially but will now have to testify in court under a government watchdog’s grilling after the legal issues have escalated.
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