In a recent report by the Wall Street Journal (WSJ), it was revealed that Elon Musk, the billionaire entrepreneur, and CEO of SpaceX, withdrew a substantial loan of $1 billion from his rocket company, SpaceX, around the same time he embarked on the acquisition of Twitter, now rebranded as X, for a whopping $44 billion.
The loan, which was backed by a portion of Musk’s SpaceX stock, received approval from SpaceX’s board in October. Notably, Musk promptly drew the entire amount from the loan during the same month, coinciding with his takeover of Twitter.
This move shed light on Musk’s long-established practice of leveraging his ownership stakes in his various companies, including the electric vehicle (EV) giant Tesla.
SpaceX, a privately held entity, has consistently served as Musk’s lender in such financial arrangements. The acquisition of Twitter further complicated Musk’s intricate financial landscape.
As of March, Musk maintains a commanding 42 percent stake in SpaceX, along with nearly 79 percent of its voting power, as reported in a filing with the Federal Communications Commission. At the close of the previous year, SpaceX boasted $4.7 billion in cash and securities, according to documentation.
Both SpaceX and X declined to comment when approached by Reuters for their response to these developments.
It is worth noting that Elon Musk’s financial maneuvers in 2022, including the sale of a significant portion of his Tesla shares, totaling approximately $40 billion, raised concerns among investors in the electric vehicle manufacturer.
In April 2023, Tesla disclosed that it had implemented stricter rules governing Musk’s use of his stake in the company for borrowing purposes, as reported by the WSJ.
In addition to his roles at Tesla and X, Musk is also a co-founder of the innovative brain-chip startup, Neuralink.