White House balances national security reviews on Elon Musk projects

The White House is considering whether some of Elon Musk’s business projects will be subject to national security reviews, including his proposed acquisitions of Twitter and the satellite internet company Starlink, according to a report.

Bloomberg wrote on Friday that Biden administration officials were concerned about the Tesla CEO’s plan to buy Twitter in a deal partially funded by non-US investors and his recent threat to pull the plug on Starlink service to Ukraine, as well as the post. From a series of tweets containing proposals on the conflict in Ukraine in favor of the Putin regime.

The report said that US officials are concerned about Musk’s plans to buy Twitter with financial support from non-US investors, including: Saudi investor Prince Al-Waleed bin Talal Al Saud. Qatar Holding, which is part of the Qatar Investment Authority; And Binance, the world’s largest cryptocurrency exchange, and its holding company is registered in the Cayman Islands. At that time, financial support from Musk’s co-investors amounted to about $7 billion.

Musk is working to complete a proposed $44 billion deal on Twitter before a court-imposed deadline of October 28, after which he faces a threat of legal action from the social media platform to force him to close the deal.

Bloomberg wrote that one way for the Biden administration to investigate Musk’s projects was the Committee on Foreign Investment in the United States (CFIUS), which can review business deals and recommend that the president suspend or block the deal.

In response, Elon Musk pointed to a tweet on Friday that cited a Bloomberg report and said it would be “hysterical if the government prevented Elon from overpaying on Twitter.” Musk responded with a laughing emoji and 100 emojis, indicating his support for the post.

It would be hysterical if the government stopped Elon from overpaying for Twitter 😂

Nick “The Carny” Lentz (@NikLentz) October 21 2022

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It would be hysterical if the government stopped Elon from overpaying for Twitter 😂

Nick “The Carny” Lentz (@NikLentz) October 21 2022

It is not clear on what basis Starlink, which is part of Musk’s Space X rocket business, will be subject to scrutiny by the committee.

On Saturday, Elon Musk announced that SpaceX would continue to pay for Starlink’s internet service in Ukraine, a day after suggesting it could not continue to fund the project, which he said was losing about $20 million a month. Starlink, operating across a constellation of 3,000 small satellites in low Earth orbit, has become a key communications link for the Ukrainian military in its fight to fend off the Russian invasion. According to Musk, there are now about 25,000 Starlink ground stations in Ukraine.

Musk alarmed the government in Kyiv this month when he posted a poll on Twitter about the country’s future, with options including formalizing Russia’s annexation of Crimea. In response, Ukraine’s president, Volodymyr Zelensky, tweeted: “Which elonmusk do you like more?” Two responses were presented: Musk supports Ukraine, or who supports Russia.

The US Treasury said: “CFIUS is committed to taking all necessary measures within its power to protect the national security of the United States. Consistent with law and practice, CFIUS does not publicly comment on transactions that it may or may not review.”

Howard Fisher, partner at law firm Moses & Singer in New York, said he does not expect the CFIUS investigation to derail the Twitter deal.

“I am skeptical that the CFIUS review will be employed to stop or pause the deal significantly,” he said. Musk might argue that he is being punished for his rhetoric, not for having foreign investors in the deal, especially given the relatively smaller volume of foreign investment reported.

Elon Musk has been contacted for comment.


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