[Pyxl101]

Can’t he borrow against his Tesla stock, and other assets including his ownership of SpaceX, and personal property, for cash to buy Twitter?

Depending on his banking relationships, and other assets that he can use as collateral for the loan, he might be able to borrow a fairly high percentage of the current value of those assets as cash (maybe 50 to 70 or 80% or more if the collateral assets are diversified or the bank simply has high confidence in his effective credit rating or ability to repay — and he may be doing other business with that bank incentivizing them to give him a favorable deal).

I’m not a billionaire but by establishing a strong relationship with a bank, have been able to establish a credit line with a limit that is a high percentage of my assets that are invested by the bank in a diversified portfolio, along with other assets, at a low interest rate (mortgage levels - a credit line at approx 2.5% interest of an amount almost equal to my total assets at the bank).

I also recently refinanced my house with this bank starting last winter and was able to achieve getting a 15 year fixed mortgage at a 2.125% interest rate - a huge reduction from my previous rate of 3.5% on a 30 year. I now pay less per month and will own my home much sooner, consequently paying considerably less in interest over the remainder of the loan, and building much more wealth in the process.

With some wealth and favorable banking relationships you can accomplish things that most ordinary people don’t know about and I myself didn’t know about until I started looking into the possibilities. I am sure a billionaire has access to even more options than I can conceive of.

[hristov]

He already did. And he got 12.5 billion and that was the maximum the banks were willing to lend him against his stock. He is still 21 billion short.

[kjksf]

I'm pretty sure that's not the maximum, just the amount he felt he needed to secure.

[weeblewobble]

He could, but if TSLA goes down and he gets a margin call things could get ugly

[mise_en_place]

It is risky but keep in mind the proposal in non-binding and contingent upon several other conditions.

[mcintyre1994]

Tesla has a rule limiting borrowing against its stock to 25% so that's probably his limiting factor.

[londons_explore]

Does the rule apply to all shareholders? I don't really see how a publically traded company can put an arbitrary condition on what can be done like that - any borrowing can be a totally private deal between you and a bank (or another private individual) - Tesla isn't even privvy to such deals, so how can they enforce any rules about them?

[kjksf]

Tesla is not the lender, Musk's broker is.

Therefore Tesla has zero input into margin rate broker decides to give Musk.