Investment giant Fidelity has marked down the value of its stake in Elon Musk’s X, formerly known as Twitter, by a staggering 78.7 percent as of the end of August, implying an overall valuation of just $9.4 billion for the social media platform that Musk purchased for $44 billion after attempting to back out of the deal.
TechCrunch reports that Fidelity has massively reduced its estimate of X’s value, just two years after Musk bought the company for $44 billion. According to newly released disclosures from Fidelity’s Blue Chip Growth Fund, the firm’s stake in X is now worth approximately $4.19 million, a steep decline from its initial investment of $19.66 million.
This markdown represents a 78.7 percent reduction in the value of Fidelity’s holding in X as of the end of August. The valuation suggests that Fidelity currently values X at around $9.4 billion overall, a mere fraction of the $44 billion purchase price paid by Musk.
It is worth noting that this is not the first time Fidelity has adjusted the value of its shares in X. As of July, the firm had already reduced the value to about $5.5 million, indicating a consistent downward trend in their assessment of the platform’s worth.
The acquisition of X, then known as Twitter, by Elon Musk was a highly publicized event that sent shockwaves through the tech industry. The deal, financed through a combination of equity and debt, was seen as a bold move by the billionaire entrepreneur to transform the social media landscape. However, the substantial markdown by Fidelity raises questions about the long-term viability and growth prospects of the platform under Musk’s leadership.
Breitbart News reported in 2023 that Fidelity had valued X at about one-third of Musk’s purchase price just nine months after the purchase:
Bloomberg reports that Twitter is now only worth a third of the $44 billion that tech tycoon Elon Musk paid for the social media giant according to Fidelity Investments. “Twitter’s value has seen a significant decline since Musk’s takeover,” a Fidelity spokesperson said. “Our recent evaluation of our equity stake in the company reflects this downturn.”
Read more at TechCrunch here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
