Elon Musk’s Purchase Of Twitter Has Been So Bad It’s Financially Comparable To The ’08 Financial Crisis

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The loans that controversial billionaire Elon Musk used to purchase the social media platform Twitter — which he subsequently rebranded as “X”, a movie that wiped out a reported worth of $4-$20 billion — have become the worst merger-finance deal for banks since the financial crisis of 2008.

Seven banks were involved in Elon Musk’s purchase of Twitter for $44 billion in October 2022, including Bank of America, Morgan Stanley, Barclays, BNP Paribas, Mizuho Bank, Societe Generale, and the Mitsubishi UFJ Financial Group.

The report about the financials of Musk’s Twitter purchase, published by the Wall Street Journal, says that the “loans have been hung longer than every similar unsold deal since the 2008-09 financial crisis for which the research firm has complete records.”

The Journal reports that banks haven’t been able to sell the debt without taking huge losses, predominantly because of the company’s poor financial performance. That means the loans have remained ‘hung,’ or stuck, on banks’ balance sheets.

“The value of the loans declined after Musk’s $44 billion takeover of Twitter—which he’s since renamed X—was completed, but the deal is now in ‘historic territory’ in terms of poor performance.” [via The Daily Beast]

As of August 2024, not even two years after Musk purchased Twitter, the social media platform is reportedly valued at $15-20 billion, which is about half of what Musk paid for it.

Musk’s ownership of Twitter has been marred with head-scratching, value-eroding decisions such as the rebranding to X, doing away with its blue check system (therefore nullifying the service’s main value proposition: rapid, instantly verifiable news), and an increase in both hate speech, bot usage, and spam, particularly of the adult film variety.

This summer, Musk and Twitter also filed an antitrust lawsuit against the Global Alliance for Responsible Media, accusing them of conspiring “to withhold billions of dollars in advertising from Twitter.” Musk, however, told advertisers who did not want to run ads on Twitter to “go F themselves” at a conference earlier this yar.

Eric Italiano BroBIble avatar
Eric Italiano is a NYC-based writer who spearheads BroBible's Pop Culture and Entertainment content. He covers topics such as Movies, TV, and Video Games, while interviewing actors, directors, and writers.