Bloomberg..QuoteSpaceX Seeks $750 Million Loan Via New Arranger BofAElon Musk’s rocket company SpaceX is planning to launch a $750 million leveraged loan this week, which will now be led by Bank of America Corp. instead of Goldman Sachs Group Inc., according to people with knowledge of the matter.Bank of America has scheduled a Nov. 7 presentation for potential investors, said the people, who asked not to be identified because the transaction is private.>
SpaceX Seeks $750 Million Loan Via New Arranger BofAElon Musk’s rocket company SpaceX is planning to launch a $750 million leveraged loan this week, which will now be led by Bank of America Corp. instead of Goldman Sachs Group Inc., according to people with knowledge of the matter.Bank of America has scheduled a Nov. 7 presentation for potential investors, said the people, who asked not to be identified because the transaction is private.>
A leveraged loan is a type of loan that is extended to companies or individuals that already have considerable amounts of debt and/or a poor credit history. Lenders consider leveraged loans to carry a higher risk of default, and as a result, a leveraged loan is more costly to the borrower. Leveraged loans for companies or individuals with debt tend to have higher interest rates than typical loans; these rates reflect the higher level of risk involved in issuing the loan.
Quote from: docmordrid on 11/05/2018 11:59 pmBloomberg..QuoteSpaceX Seeks $750 Million Loan Via New Arranger BofAElon Musk’s rocket company SpaceX is planning to launch a $750 million leveraged loan this week, which will now be led by Bank of America Corp. instead of Goldman Sachs Group Inc., according to people with knowledge of the matter.Bank of America has scheduled a Nov. 7 presentation for potential investors, said the people, who asked not to be identified because the transaction is private.>That is a pretty massive loan. Equivalent to almost half of 2019 revenue. The leveraged loan term used is also somewhat worrying. Might just be Musk's tendency to take everything to 111%. If a $500 million dollar loan was prudent, why not $750 million.QuoteA leveraged loan is a type of loan that is extended to companies or individuals that already have considerable amounts of debt and/or a poor credit history. Lenders consider leveraged loans to carry a higher risk of default, and as a result, a leveraged loan is more costly to the borrower. Leveraged loans for companies or individuals with debt tend to have higher interest rates than typical loans; these rates reflect the higher level of risk involved in issuing the loan.https://www.investopedia.com/terms/l/leveragedloan.asp
>That is a pretty massive loan. Equivalent to almost half of 2019 revenue. The leveraged loan term used is also somewhat worrying. Might just be Musk's tendency to take everything to 111%. If a $500 million dollar loan was prudent, why not $750 million.>
This is good. It'll allow them to do Starlink and BFR much faster while still being on their own terms.
The leveraged loan term used is also somewhat worrying.
Quote from: ncb1397 on 11/06/2018 02:37 pmThe leveraged loan term used is also somewhat worrying. By valuation, SpaceX is the 3rd largest private tech startup in the US, 1st and 2nd are Uber and Airbnb. Uber just raised $1.5B using leveraged loans a few months ago, and Airbnb raised $1B using leverage loans in 2016. So it seems that this is pretty normal funding behavior for tech companies.
Quote from: su27k on 11/06/2018 03:35 pmQuote from: ncb1397 on 11/06/2018 02:37 pmThe leveraged loan term used is also somewhat worrying. By valuation, SpaceX is the 3rd largest private tech startup in the US, 1st and 2nd are Uber and Airbnb. Uber just raised $1.5B using leveraged loans a few months ago, and Airbnb raised $1B using leverage loans in 2016. So it seems that this is pretty normal funding behavior for tech companies.Is the size of your leveraged loan the new measuring stick in Silicon Valley?
...SpaceX on Wednesday circulated pricing on a proposed $750 million term loan that will put cash on the company’s balance sheet, two sources said.The company floated pricing in the 400bp-425bp over Libor range with a 0% floor and a discount of 99. The loan will have six months of soft call protection at 101
Quote...SpaceX on Wednesday circulated pricing on a proposed $750 million term loan that will put cash on the company’s balance sheet, two sources said.The company floated pricing in the 400bp-425bp over Libor range with a 0% floor and a discount of 99. The loan will have six months of soft call protection at 101Reuters Article
Quote from: IntoTheVoid on 11/08/2018 03:19 amQuote...SpaceX on Wednesday circulated pricing on a proposed $750 million term loan that will put cash on the company’s balance sheet, two sources said.The company floated pricing in the 400bp-425bp over Libor range with a 0% floor and a discount of 99. The loan will have six months of soft call protection at 101Reuters ArticleLibor and bp I understand but can anyone translate the rest of the financial jargon:- 0% floor- discount of 99- six months of soft call protection at 101
While SpaceX is burning through cash, disclosures to potential lenders showed the company had positive earnings before interest, taxes, depreciation and amortization of around $270 million for the twelve months through September, people with knowledge of the matter said. But that’s because it included amounts that customers had prepaid and because it excluded costs related to non-core research and development, the people said. Without those adjustments, earnings for the period were negative, they said.
https://www.bloomberg.com/news/articles/2018-11-08/musk-said-to-divide-wall-street-with-demands-for-new-spacex-loanQuoteWhile SpaceX is burning through cash, disclosures to potential lenders showed the company had positive earnings before interest, taxes, depreciation and amortization of around $270 million for the twelve months through September, people with knowledge of the matter said. But that’s because it included amounts that customers had prepaid and because it excluded costs related to non-core research and development, the people said. Without those adjustments, earnings for the period were negative, they said.Interesting information on SpaceX financials from a recent Bloomberg article (via reddit)I wonder if BFR development is included in "core development" here, or is it one of the excluded items?Hopefully they improve their financials enough to finance BFR.
>I did read yesterday or today an article by some market analyst that SpaceX should be included in the list of possible IPO's for 2019. >