Elon Musk’s Twitter acquisition could be one of the worst leveraged buyouts (LBO) for banks since 2008, heightening risks for Tesla shareholders:

– Musk financed $44 billion for Twitter, with $13 billion raised from a group of lenders to prevent overwhelming Tesla shares.
– Wall Street typically offloads LBO debt quickly, but rising interest rates and Twitter’s weak financials have stymied this process.
– Investment banks now hold onto the Twitter debt longer than at any time since Lehman Brothers’ collapse, with some LBO debt remaining for nearly two years.
– Initially, Twitter expected to incur over $1 billion in yearly interest, while U.S. revenue projections hover around $600 million this year, creating a concerning financial narrative.
– Musk has been in talks with bankers for debt restructuring but progress has stalled, negatively impacting banks like Barclays, where a 40% compensation cut was announced, leading to significant departures in management.
– Concerns are rising that Musk may have to sell $1 to $2 billion in Tesla shares to address Twitter’s financial issues.

Musk’s financial maneuvers are under scrutiny, as the situation at Twitter potentially threatens the stability of Tesla.