The truth is, everyone knew Twitter wasn’t worth $44 billion when Elon Musk bought it a year ago. Now we know what Musk himself believes it’s worth today: $19 billion.
He bought them at $100 each, and now they are worth $45 per share
On Monday, X employees received company shares valued at $19 billion, or $45 per share, according to internal documents seen by The Verge.
This price represents a 55% drop from Musk’s original purchase price, as indicated by the documents, which state, “the fair market value per share is determined by the Board of Directors based on a variety of factors in compliance with applicable tax rules.”
Since taking over Twitter, Musk has expressed his intention to model the company’s compensation plan after SpaceX, which is also private but allows employees to regularly redeem a portion of their shares to external investors.
The type of shares that X offers its employees are called Restricted Stock Units (RSUs). These RSUs are granted over a four-year period from their grant date and require a “liquidity event,” such as an IPO or the sale of the company, to be taxed as income, according to internal documents.
Until now, X employees have been working there without knowing the company’s value since Musk bought it. This information about the stock allocation finally answers that question.
However, Musk’s valuation might still be overly generous; one of his major investors, Fidelity, believes X is worth 65% less than what he paid for it.
Author: Chema Carvajal Sarabia
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