Why Elon Musk’s Net Worth Dropped Under $200 Billion After Twitter Deal

Elon Musk’s net worth fell below $200 billion (roughly Rs. 16,31,070 crore) on Tuesday as investors dumped Tesla shares on fears that the CEO and largest shareholder of the world’s most valuable electric car maker is too busy with Twitter. Musk now has a net worth of $194.8 billion (roughly Rs. 15,87,840 crore), according to Forbes, with a major share of that coming from his nearly 15 percent stake in Tesla, which has a market value of $622 billion (roughly Rs 50,69,380 crore).

Tesla Inc has lost almost half of its market value and net worth by $70 billion (roughly Rs. 5,700 crore) since it bid for Twitter in April.

Investors initially shied away from Tesla due to concerns over the share sale by Musk, who spent at least $15 billion (roughly Rs. 1,22,270 crore). He closed a $44 billion (approx. Rs. 3,58,650 crore) deal last month with $13 billion (approx. Rs. 1,05,970 crore) in loans and $33.5 billion (approx. Rs. 2,73,070) equity commitment.

Now Wall Street fears that Musk has stretched himself too thin at a time when the EV maker is consolidating production and facing increasing competition.

“It looks like Elon Musk spends 100 percent of the time on Twitter and you know, he might need more money,” said Jay Hatfield at Infrastructure Capital.

Since buying Twitter, Musk has made very few tweets about Tesla, a practice that helped him gain traction on the platform. Instead he has used Twitter to announce the social media company’s plans such as the $8 (roughly Rs. 660) monthly subscription for blue tick verification.

The net worth of the world’s richest person, who also owns rocket company SpaceX, is estimated at $40 billion (roughly Rs. 3,26,050 crore) more than the second richest person, LVMH owner Bernard Arnault.

Shares of Tesla were down 2 percent at $193.7 (roughly Rs. 15,790) in afternoon trade, falling for the third straight time.

© Thomson Reuters 2022