Entrepreneur Elon Musk has offered Twitter employees rewards in the form of shares worth about $20 billion, valuing the company at that amount. The business publication The Information reported that Musk sent a letter to an employee of the social media site with the proposal. The valuation by Musk is seen as acknowledgement of the sharp decline in Twitter’s value since he acquired the network, although it is significantly higher than the public market valuation of Twitter’s competitors.
In April 2022, Musk bought Twitter for $44 billion. Under the terms of the agreement, shareholders in the social network received $54.20 per common share, with a premium of 38% over the closing price on April 1, when Musk announced his acquisition of a 9% stake in Twitter.
On March 4, 2023, The Wall Street Journal reported that in December, Twitter’s revenue and adjusted earnings fell 40% year-on-year. The reason for the social network’s predicament is the suspension of cooperation with many advertisers following Musk’s acquisition of the company. The entrepreneur had to take out a loan of $13 billion at an annual interest rate of more than $1 billion to close the deal, and the first payment to the banks has already been made.
In February, Musk wrote on Twitter that the company is “definitely not financially healthy” and that “work” will be required to achieve this goal. He also noted that he had been trying to “save Twitter from bankruptcy” for the past three months.