February 2, 2023

Morgan Stanley is a big winner in Musk’s Twitter deal

2 min read

Morgan Stanley (Ms.) Suggested Tesla (TSLA) CEO at 44 billion Acquisition Of Twitter (TWTR). The bank also helped secure 25 25.5 billion in funding for the deal, including 12 12.5 billion in loans that used Musk’s Tesla stock as collateral. That should lead to profitable fees and interest income for Morgan Stanley.

Investment banks typically receive a 1% to 3% reduction in the cost of a merger agreement, which is distributed to all the banks involved. Based on a purchase price of $ 44 billion, it works from $ 440 million to $ 1.3 billion.

So in addition to advising Morgan Stanley Musk, he might consider taking tens – or even hundreds – of millions of dollars from Wall Street bragging rights.

Morgan Stanley is one of the world’s leading financial firms. According to the so-called League Tables track The Financial Times, The bank received the second largest amount of fees from investment banking in the first quarter. So far this year, its $ 852 million fee is behind Goldman Sachs alone, and 87% more than in the first quarter of 2021.
Morgan Stanley said in a statement First quarter earnings report Advisory revenue for the merger has almost doubled from a year ago. But for the broader market, aggregate investment banking earnings stalled during the first three months due to initial public offerings and slowdown in corporate bond sales.
Much of Elon Musk's Twitter deal is still a mystery.

The bank did not comment on the company’s operations for Musk or Tesla.

But it should come as no surprise that Musk is working with Morgan Stanley. After all, he has a more than a decade-long relationship with the company. And the bank was one of four underwriters, along with Tesla’s 2010 IPO. Goldman Sachs (GS), JP Morgan Chase (JPM) And Deutsche Bank (DB).

Adam Jonas, Morgan Stanley’s auto analyst, is one of Tesla’s biggest bulls on Wall Street. Jonas currently has a “Buy” rating on Tesla stock and a price target of $ 1,300, which is approximately 30% higher than the current stock price of ً 1,000 per share.

Jonas also recently wrote positive reports about the prospects for Musk’s دو 2 billion private companies. SpaceX And Boring company. Even Jonas Recommended in 2017. That Tesla and SpaceX should merge, and recently SpaceX predicted that SpaceX could eventually help make Musk a billionaire.
So even if Musk’s takeover of Twitter doesn’t turn the company into a social media wizard that could challenge the likes of Facebook and Instagram. Meta platforms (FB), Snap chat (All of a sudden) Or TikTok, Morgan Stanley could still benefit.

Whatever the investment bank puts forward to live up to Musk’s goodwill, it could be beneficial, especially if the world’s richest man offers more mergers for Tesla, an IPO for SpaceX or The Boring Company, or Any other desire for which he needs to increase more cash strikes

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