(Bloomberg) -- In the months after Elon Musk closed on his $44 billion purchase of Twitter Inc., there was a broad consensus that not only had he overpaid, but that he’d dragged some of the world’s best-known investors into a bad deal. Now backers including Larry Ellison, Andreessen Horowitz and Bill Ackman’s charitable foundation stand to earn a nearly 200% return on their equity investment.Key Speakers At Oracle OpenWorld 2018 Conference Through a series of favorable mergers, investors in the social-media platform now known as X own a stake in SpaceX that would be worth roughly $100 billion if the rocket, AI and media company achieves a $2 trillion valuation in its initial public offering, according to Bloomberg calculations.Ross Gerber, chief executive officer of investment-management firm Gerber Kawasaki and a Twitter investor, said it’s proof of the importance Musk places on his private company investors.“They’re his best friends,” said Gerber, who invested less than $1 million in Twitter alongside Musk. “The same people own all of Elon’s companies.” A spokesperson for SpaceX didn’t reply to a request for comment.The Takeover Musk made his offer to buy Twitter in April 2022 after several months of complaints about censorship, spam bots and company leadership on the social media platform. During the six months it took to complete the deal, tech stocks were sinking as interest rates rose and investor sentiment turned cautious. U.S. President Trump Meets With China's President Xi And Attends State BanquetMusk attempted to withdraw from the deal, but ultimately proceeded after Twitter sued to enforce the terms of their agreement. By the time the deal closed, the $44 billion price tag — of which roughly $33.5 billion was equity — appeared to be a significant over-pay. Musk put up the bulk of the funds, with about $10 billion of equity coming from new investors and existing Twitter shareholders rolling over their stakes. They included Saudi Prince Alwaleed bin Talal, 8VC, Sequoia Capital, Sean “Diddy” Combs and Twitter founder Jack Dorsey, some of whom were identified as a result of a lawsuit initiated by former Twitter employees. Almost immediately some external investors — including mutal fund giant Fidelity — marked their stakes below Twitter’s purchase price, reflecting the faltering tech market that had sunk valuations for competing social media companies.Musk’s leadership of the San Francisco-based firm was also raising eyebrows. After taking the reigns with an attempt at humor, he fired half the employees, including most of its executive team.Exclusive: Saudi Arabia's Prince Alwaleed bin TalalJust a week after buying Twitter he publicly threatened to go “thermonuclear” in response to a campaign encouraging an advertiser boycott. He also had to deal with the financial pressure of servicing the roughly $13 billion of debt the company was saddled with as a result of the acquisition.Two and a half years later, user growth has stalled and advertising revenue still hasn’t recovered. The gains for Twitter’s investors have come not from a business turnaround, but through a series of transactions directed by Musk that gave the shareholders stakes in more valuable companies.‘Heavily Diluted’Once Musk began building his artificial intelligence startup, xAI, he worked to integrate it tightly with X. Its chatbot, Grok, is widely accessible through the platform and X’s data archives helped train its large language models. In March 2025, Musk formally combined the two businesses, both of which he controlled, in a deal valuing xAI at $80 billion and X at $44 billion, including debt, roughly what investors had originally paid. Part of X’s higher valuation was the data sets it brought to the combined firm. Still, it came as a surprise for many X investors who were sitting on paper losses.“I was very excited,” Gerber said. “I had marked down the position like 75%, and I got to mark it back up.”Then in February, that business was combined with SpaceX, one of the few companies in the world that might generate more investor excitement than an AI platform.SpaceX Starship Flight 8 Launches From TexasSpaceX has since filed confidentially for an IPO that could take place in June at a more than $2 trillion valuation, Bloomberg News reported last month, which would give X shareholders the ability to cash out of their investments. At that amount, it would be bigger than all but a handful of the companies in the S&P 500 Index, and larger than Musk’s own Tesla Inc.Alwaleed, who rolled over a stake in Twitter when Musk bought it and also participated in an early xAI fundraising round, says he now owns a SpaceX stake valued at more than $4 billion — more than seven times his original investment.The series of mergers, as well as some dilution from fundraising, meant that X shareholders now own roughly 5% of the entire enterprise, according to Bloomberg calculations.“The fact that essentially Spacex got heavily diluted so that Elon could make whole his Twitter and xAI investors kind of just sucks for SpaceX,” said Gerber, who estimates his return will be two and a half to three times his original investment if the rocket company goes public at its target valuation.--With assistance from Devon Pendleton and Carmen Arroyo.Most Read from BloombergHormuz Oil Flows Creep Higher as More Supertankers ExitIran’s Kharg Island Oil Jetties Empty Again Yesterday, Satellite ShowsWhat Is The Thucydides Trap and Why Did Xi Raise It With Trump?Nigerian Tycoon Femi Otedola Buys £53 Million London MansionTrump Says China Offered Help on Iran as Ship Taken Near UAE©2026 Bloomberg L.P.
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