It seems the ‘Chief Twit’ (soon to be a former one), Elon Musk has bungled up big time when it comes to his $44 billion acquisition of Twitter. According to Fidelity, the social media platform could be worth only around $15 billion now – a markdown of a third of what Musk paid for it.
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In a monthly disclosure, Fidelity’s Blue Chip Growth Fund valued its stake in Twitter, now referred to as X Holdings Corp, at $6.55 million as of April 28. According to a Reuters report, Fidelity’s Blue Chip Growth Fund stake of 0.016% in Twitter was valued at $20 billion at the end of October last year.
Musk has admitted publicly in an email to Twitter employees that the company was only worth $20 billion but had claimed that the bird app had the potential to become a super app worth more than $250 billion. However, as he confessed, “I see a clear, but difficult, path to a >$250B valuation.”
Musk’s acquisition of Twitter had led to investors raising questions about how much time would he be able to contribute to his EV company, Tesla (TSLA) as he had become increasingly focused on Twitter. These concerns have led to Tesla stock being down by around 20% in the past year.
However, it seems that Twitter could be finally turning a corner as Musk stated in an interview with BBC back in April that the social media platform is now “roughly breaking even,” following the return of advertisers to the platform and aggressive cost-cutting including slashing around 80% of its staff.
Over the next few weeks, Musk will step down as Twitter’s CEO and hand over the reins to the incoming CEO, Linda Yaccarino.
