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Fidelity, which helped Elon Musk acquire the platform formerly known as Twitter in late 2022, said its stake in the company fell 72% during that period, according to a Bloomberg analysis.
In November, Fidelity announced that its current stake in
Musk bought the company in October 2022 for $44 billion. If the company as a whole is also down 72% since its purchase, that means it's now worth about $12.3 billion, or less than the $13 billion in debt the billionaire took on for the purchase the platform has recorded.
That poses a problem for banks that hold Musk's debt. They either have to sell it at a deep discount or continue to hold it and potentially see further decline in value.
According to an FT analysis earlier this week, X debt would likely sell for 60 cents on the dollar. In total, that would mean a loss of $5 billion.
While the Twitter takeover has been a financial mess so far, Musk's massive net worth will likely support him no matter the outcome. When he completed the purchase, Musk sold large blocks of Tesla shares. (He owns about 13% of the automaker's stock.) The move shocked the market at the time, but the stock has returned to healthy levels in recent months and the billionaire is back at the top of the rankings of the world's richest people.