Elon Musk secured a multibillion-dollar margin loan using Tesla stock as collateral to finance his acquisition of Twitter (now rebranded as X). In recent months, Tesla’s share price has been cut in half due to a confluence of factors—slowing EV demand amid high interest rates, shifting electric vehicle policies under the Trump administration, market volatility driven by trade tensions, and pressure from a coordinated NGO-driven color revolution known as “Tesla Takedown,” aimed at crashing the stock to trigger loan repayment obligations tied to Musk’s pledged equity.

In short, volatility in Tesla shares left Musk heavily exposed to potential loan repayment thresholds being triggered - which was set to occur at or below $114 according to reports - until now.

On Friday evening, Musk announced the merger of X with his AI startup, xAI, in an all-stock transaction that strengthens his financial position, protects Tesla shareholders, and renders the Tesla Takedown color revolution largely ineffective in achieving its intended goal. 

Musk outlined xAI's acquisition of X:

Musk privately owns and controls both xAI and X.

The transaction is structured as a stock swap, with X investors receiving xAI shares in return. Both companies share overlapping investors, including Fidelity Management, Saudi Arabia's Kingdom Holding Co, Andreessen Horowitz, Sequoia Capital, and Vy Capital. 

Musk, also the CEO of Tesla and SpaceX, purchased Twitter in a $44 billion deal in 2022. X CEO Linda Yaccarino wrote on X last night: "The future could not be brighter." 

Musk's X post announcing the acquisition stated that the deal was about "blending" the AI startup and social media platform to create "a platform that doesn't just reflect the world but actively accelerates human progress." However, the move also eliminates the risk of Musk undergoing a forced liquidation of the $12.5 billion margin loan backed by his Tesla shares.

As we previously described at the beginning of the note, Tesla shares were halved for a number of reasons:

And this...

Last week, the Democratic Party and their Communist revolutionaries spelled out their sinister plans...  

"If we kill the Tesla brand" and "drive down the stock price low enough. We can force him to sell his stock to pay back the billions of dollars of debt he took on to buy Twitter. 

"This will drive Tesla into a death spiral," Micah Lee, The Intercept's former Director of Information Security, explained on a recent Tesla Takedown teleconference with other far-left revolutionaries. 

Musk's indebtedness from leveraging Tesla shares to fund the X deal is no longer a concern for Tesla shareholders. This strategic move also renders the Tesla Takedown color revolution funded by rogue Democrats less likely to force a liquidation.