Banks face billions in losses as Twitter deal hangs in the balance

Morgan Stanley, Bank of America, Barclays, and MUFG could be on the hook for billions of dollars if the deal falls through.

Twitter's lenders, led by Morgan Stanley, could face billions of dollars in losses if they tried to walk away from the company's $44 billion acquisition.

The banks have already committed to providing $13 billion in debt financing for the deal, which is set to close on October 28. However, if the deal falls through, the banks could be forced to sell the debt at a loss, which could cost them billions of dollars.

The banks are particularly vulnerable to losses because they have not been able to syndicate the debt to other investors. This means that they are on the hook for the entire amount of the loan if the deal falls through.

The banks are now trying to negotiate a new deal with Musk that would give them more protection if the deal falls through. However, it is unclear if Musk is willing to agree to these terms.

If the deal does fall through, it would be a major blow to Morgan Stanley and the other banks involved. It would also raise questions about the future of Twitter, which is already struggling financially.