Investor: Twitter's current valuation is only one-third that of Musk's acquisition
On May 31st, according to data from Fidelity, a US financial services company, Twitter's current valuation is only one-third of Elon Musk's bid. Fidelity has recently lowered the value of their Twitter shares
On May 31st, according to data from Fidelity, a US financial services company, Twitter's current valuation is only one-third of Elon Musk's bid. Fidelity has recently lowered the value of their Twitter shares.
Musk previously admitted that he paid an exorbitant price to acquire Twitter. Earlier this year, he offered new equity rewards to Twitter employees, valued at $20 billion at the time. It is currently unclear how the latest valuation of Fidelity Investment was derived, and it is uncertain whether they obtained non-public information from Twitter.
Last November, Fidelity Investment reduced the value of its Twitter shares to 44% of the acquisition price for the first time. Subsequently, in December of last year and February of this year, the institution lowered the value of these shares twice.
Since Musk took over, Twitter's financial situation has been struggling. Musk was burdened with $13 billion in debt for the company, and his unstable decision-making and difficult content review led to a 50% decrease in advertising revenue. In order to compensate for the loss of revenue, Twitter attempted to launch a blue V subscription service, but it has not been successful so far. As of the end of March, less than 1% of Twitter's monthly active users subscribed to the service.
Twitter did not specifically respond to requests for comment.
According to the Bloomberg Billionaires Index, Musk's current investment in Twitter is worth $8.8 billion. The index uses the valuation of Fidelity Investment to calculate the value of Musk's Twitter shares. Last year, Musk spent over $25 billion to acquire about 79% of Twitter's shares.
The Bloomberg Billionaires Index also shows that the decline in Twitter valuation has caused Musk's wealth ($187 billion) to shrink by approximately $850 million. Despite Twitter's problems, Musk's wealth has increased by over $48 billion so far this year, mainly thanks to a 63% increase in Tesla's stock price. (Small)
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