SpaceX secured a $20 billion bridge loan from major banks to retire $17.5 billion of high-interest junk debt accumulated by X and xAI. The retired debt carried interest rates up to 12.5%, while the bridge loan’s effective rate was 4.58% as of 31 March. The interest-rate gap reduces the combined annual interest bill to roughly $900 million. The loan was arranged by Goldman Sachs, Bank of America, Citigroup, JPMorgan Chase, and Morgan Stanley, matures in September 2027, and can be prepaid at any time. SpaceX must repay at least some of the loan within six months using proceeds from certain debt financings and the IPO. The debt originated from Musk’s 2022 Twitter acquisition and later xAI financing, including a $33 billion all-stock acquisition and subsequent debt issuance.
"The debt trail starts with Musk’s 2022 acquisition of Twitter. That deal loaded the social media company with roughly $12.5 billion in borrowings, creating what became one of Wall Street’s most notorious hung-debt situations. The banks that underwrote the deal were unable to sell the debt to investors for years. They ultimately succeeded in offloading it last year. Then xAI acquired X in March 2025 in a $33 billion all-stock deal."
Read at TNW | Finance
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