Several of Silicon Valley’s top venture capitalists, a Saudi royal and fund linked to disgraced hip hop mogul Sean ‘Diddy’ Combs are among the investors that helped Elon Musk acquire X for $44 billion two years ago, according to a court filing.
A federal judge in San Francisco ordered X on Tuesday to unseal the list of shareholders who were part of the group that took the company formerly known as Twitter private in October 2022.
The filing lists nearly 100 investors who own a stake in X, according to The Washington Post.
Noted VC firm Andreessen Horowitz, Saudi Prince Alwaleed bin Talal al Saud and Twitter founder and former CEO Jack Dorsey are among those who own part of X, it was revealed the filing.
Larry Ellison, the Oracle co-founder who counts himself as a friend of Musk, reportedly contributed $1 billion toward the investment group which purchased Twitter.
X had resisted attempts to have the list of investors revealed. The company is being sued by several former Twitter employees who claim that Musk violated their arbitration agreements by failing to pay certain fees after he bought the company.
Jacob Silverman, a technology journalist who was represented by attorneys for the nonprofit Reporters Committee for Freedom of the Press, filed a motion asking the court to unseal the documents. His request was granted by US District Judge Susan Illston.
Katie Townsend, legal director for the Reporters Committee, praised Illston’s ruling, which confirms “the interest of the general public in knowing who owns X.”
To complete the purchase, Musk borrowed $13 billion from several banks, including Morgan Stanley, Bank of America and Barclays.
Collectively, Musk is on the hook for annual interest payments to the banks that add up to more than $1 billion.
An analysis by The Wall Street Journal earlier this week found that the $13 billion in loans that Musk took from the banks have turned out to be the worst merger-finance deal for lenders since the recession of 2008-2009 — mainly due to the fact that they have been unable to sell the debt to other investors.
Banks who extend loans for mergers and acquisitions make money on the fees that they collect after getting a buyer to relieve them of the incurred debt within a short period of time.
But X’s weak finances means that selling the debt would put the banks at a loss. As a result, the loans are what are known in industry jargon as “hung” — meaning that they have remained stuck on their balance sheets.
According to the Journal, the loans that were made to Twitter have been unsold for longer than every similar deal that was made since the 2008-2009 crisis.
Earlier this year, documents leaked by X showed that its value had fallen by more than 70% — to around $12.5 billion.
Fidelity, the mutual fund giant that is also among investors who helped Musk acquire the company, marked down the value of its shares somewhere between $15 billion and $16 billion.
At the time of the acquisition, Musk and the lenders knew that the $44 billion that he paid was way above the actual value of the company.
But the banks decided to extend the loans to Musk anyway because of the allure of servicing the man who at the time was the world’s wealthiest person, according to the Journal.
After Musk bought Twitter, he reduced the company’s work force by some 80%. Musk has also struggled to win back advertisers who fled the site in response to his loose content moderation policies that critics say has allowed hate speech to proliferate.
The Post has sought comment from X.
