Remember that he shares ownership with other investors. So what he did is combine those investors into a single group, more or less.
Let’s say that you have a company that makes buttons and someone else has a company that sews shirts. You decide each of you would be better off if this was a single company. Shirt company might agree to “buy” button company on exchange for half ownership of the resulting Shirt company.
Elon basically did that with two different groups of investors. Anyone who owned xAI before now owns a similar amount of xAI + Twitter, and same for anyone who owned Twitter before.
The catch is that because the pie supposedly got bigger, everyone’s slice of the pie got a little narrower. Someone who owned 5% of xAI probably only owns about 2.5% of xAI + Twitter.
Depending on how much Elon owns of each company he very likely screwed over one side of the other to come out ahead.
Comments
One company bought the other company. Shareholders of x got paid in stocks of xai.
And what is the benefit of this to Elon?
You mean Elon Musk?
Remember that he shares ownership with other investors. So what he did is combine those investors into a single group, more or less.
Let’s say that you have a company that makes buttons and someone else has a company that sews shirts. You decide each of you would be better off if this was a single company. Shirt company might agree to “buy” button company on exchange for half ownership of the resulting Shirt company.
Elon basically did that with two different groups of investors. Anyone who owned xAI before now owns a similar amount of xAI + Twitter, and same for anyone who owned Twitter before.
The catch is that because the pie supposedly got bigger, everyone’s slice of the pie got a little narrower. Someone who owned 5% of xAI probably only owns about 2.5% of xAI + Twitter.
Depending on how much Elon owns of each company he very likely screwed over one side of the other to come out ahead.