Elon Musk formed a trio of holding companies as he fights to acquire Twitter, potentially giving him a path to combine all his business ventures into a new 'super company'. According to Bloomberg, Mr Musk registered three new companies on Tuesday in the tax-friendly state of Delaware under variations of the name “X Holdings”.
As per the filings with the US Securities and Exchange Commission, Mr Musk plans 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, the New York Post said in a report. Giving details about the three companies, Bloomberg said that the first company, X Holdings I Inc., lists Mr Musk as president, treasurer and secretary, and would be the parent company of Twitter if his bid succeeds. Another entity, X Holdings II Inc., would merge with Twitter as part of the acquisition. X Holdings III LLC would be used to help fund the transaction.
It is still not clear if the holding companies would have any affiliation with Mr Musk's current business, including Tesla and SpaceX. However, it is to mention that the billionaire had mused about creating a parent firm as far back as 2012. Back in 2020, Mr Musk even said that calling the parent company “X” was a good idea.
Notably, Mr Musk didn't dismiss the idea of creating a parent firm during a discussion last week in a TED interview. However, he said that creating such a holding company would be “tricky”. He stated that Tesla is publicly traded and the “investor base of Tesla, SpaceX and certainly Boring Co. and Neuralink, are quite different”.
Experts say that to combine his companies under one parent entity, Mr Musk would likely have to follow in the footsteps of other tech giants like Google, which reconstructed itself in 2015 to create a new holding company called Alphabet Inc. 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.
