Elon Musk formed a trio of holding companies as part of his bid to acquire Twitter, potentially giving the billionaire a path to bring all of his business ventures under a single parent.
The new companies — each with a variation of the name “X Holdings” — were formed this week in Delaware, according to records filed with the state. Musk and his investing partners plan to put money into one of the entities to fund the purchase of Twitter shares in a tender offer, while a subsidiary would merge with the social media firm, according to filings with the US Securities and Exchange Commission.
While it’s not clear if the holding companies would have any affiliation with Musk’s current businesses, including Tesla and SpaceX, the name offers a clue. He has mused about creating a parent as far back as 2012, and in 2020 he said calling it “X” was a “good idea”. Musk also owns the domain “X.com” — the name of the online payments company he started and eventually merged with PayPal.
Musk didn’t immediately respond to an e-mailed request for comment.
The entrepreneur, whose business interests also include Neuralink and the Boring Co, didn’t dismiss the idea during a discussion last week with TED’s Chris Anderson but said that creating such a holding company would be “tricky”. Tesla is publicly traded and the “investor base of Tesla and SpaceX, and certainly Boring Co and Neuralink, are quite different”.
To combine his companies under one parent entity, Musk would likely have to follow in the footsteps of other tech giants like Google, which restructured itself in 2015 to create a new holding company called Alphabet. But he would also have to separately acquire SpaceX, Neuralink and Boring, which are private and have all seen their valuations go up in recent years.
“It’s not that easy to sort of combine these things,” he said to Anderson. — Sean O’Kane, (c) 2022 Bloomberg LP