Investors criticize X for not recovering from the valuation that fell after Elon Musk's acquisition
In October 2022, Twitter (now X) was acquired by Elon Musk for $44 billion (approximately 6.451 trillion yen). After that, its valuation fell to $15 billion (approximately 2.2 trillion yen), one-third of the acquisition price, in six months. While some investors are not concerned about the fact that the valuation has not recovered, saying that it was a 'good investment,' there are also voices criticizing Musk for 'destroying enormous wealth.'
How much Twitter's top investors have lost on Musk's deal - The Washington Post
Twitter Investor Says Elon Musk 'Destroyed' App's Value
Fidelity Investments , an asset management company, provided funds for the acquisition of Twitter and acquired shares worth $316 million (about 46.3 billion yen) at the time of the acquisition. However, after about two years, the valuation of the shares fell to $88 million (about 12.9 billion yen), 27% of the original value.
The value of Fidelity's X shares was reported to have fallen by 71.5% as of the end of December 2023, meaning it has fallen a further 1.5 points.
According to an interview with The Washington Post, Saudi Arabia's Prince Alwaleed bin Talal had bought $1.4 billion worth of X shares, and although the valuation had fallen to $530 million, he said, 'We value it at, at least, what it was when we bought it,' and seemed satisfied with his investment.
On the other hand, investor Ross Gerber criticized Musk's move, saying, 'Musk has destroyed a huge amount of wealth since he bought Twitter.'
X has reported a decline in advertising revenue , and one of the reasons for this is said to be that Musk is undermining CEO Linda Yaccarino's initiatives.
Elon Musk always destroys the sales promoted by Linda Yaccarino, CEO of X (formerly Twitter) - GIGAZINE
'It's not a fun story to have Musk try to explain to people who invested any amount of money why they lost money,' Gerber said. Gerber's investment amount is less than $1 million (about 146 million yen).
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