Elon Musk’s X is in talks to raise money from investors at a $44 billion (€42.2billion) valuation, according to people familiar with the matter.
That is the same price that Musk paid for the social media company in 2022, when it was called Twitter.
The funding round would be a remarkable turn of fortunes for the company after Musk’s takeover and overhaul caused many users and advertisers to flee.
In December, prior to the current deal talks, Fidelity Investments had marked down its Twitter stake by about 70 per cent from the 2022 sale price.
Talks for the new X financing round are still ongoing and the details could change, said the people, who asked not to be identified discussing private information. The company could also abandon financing talks.
This is the first known investment round for the social media company since Musk took it private. X did not respond to requests for comment. Musk, who has taken a starring role in the administration of US President Donald Trump, has seen his companies’ fortunes gain in recent months.
Tesla shares have climbed more than 40 per cent since Trump’s election, and SpaceX’s December $350 billion valuation made it the world’s largest tech start-up.
Musk has tapped the private markets for billions with recent deals. His artificial intelligence start-up, xAI, is also seeking to raise financing, with a valuation that’s had a boost in recent weeks.
The AI company is canvassing potential investors for a funding round that could value it at about $75 billion, though the terms are not finalised and could change, people have told Bloomberg News.
X has a stake of about $6 billion in xAI. X’s debt has also undergone a recent revaluation to the upside.
Morgan Stanley last week was putting the final touches on the sale of $3 billion of X debt at no discount to face value.
That was after getting more than enough demand from investors – a turnaround from earlier efforts to offload the debt, which were met with hesitation from would-be buyers.
In its marketing pitch for a prior sale, Morgan Stanley showed investors details of X’s 2024 earnings and revenue that, while heavily adjusted, suggested that the company’s finances had stabilised, due in part to a bump in advertising around the US election.
Musk’s proximity to Trump has altered perceptions of X’s prospects, and some investors are betting his role will serve to advance the interests of his businesses.
Investors who backed Musk’s acquisition include AndreessenHorowitz, Sequoia Capital and the Qatar Investment Authority. – Bloomberg
