The bankers of Reuters are considering giving the CEO of Tesla Inc with new margin loans backed by the U.S. automaker's stock to replace some of the high interest debt on his Twitter deal, Bloomberg News reported on Wednesday.
The Morgan Stanley-led bank group and Musk's advisers have discussed ways to reduce the $13 billion debt they took on as part of Musk's $44 billion deal, according to a report, citing people with knowledge of the matter.
The report said that the maximum banks have agreed to finance the acquisition in April and that discussions have focused on replacing the $3 billion of unsecured debt on which Twitter pays an interest rate of 11.75%.
Morgan Stanley, Bank of America Corp, Barclays Plc and Mitsubishi UFJ Financial Group Inc led the $13 billion financing for the bid by Musk.
The banks are not expected to offload any of the debt to institutional investors until the new year, according to Bloomberg.
In October, Reuters reported that banks had abandoned plans to sell the debt to investors because of uncertainty surrounding Twitter's fortunes and losses.
Musk closed the deal with $13 billion in loans from banks and $33.5 billion in equity commitment, which included his 9.6% Twitter stake of $4 billion and $7.1 billion from investors, including Oracle Corp co-founder Larry Ellison and Saudi Prince Alwaleed bin Talal.