X Offers Employee Stock Options Valuing The Company At $19 Billion
According to internal records, staff at X were granted shares in the company on Monday at a price of $19 billion or $45 per share. According to the filings, that price is a 55 per cent discount to Musk's original purchase price and "the fair market value per share is determined by the board of directors based on a number of factors in a manner that complies with applicable tax rules." (X's chair, Musk, has yet to constitute a formal board.)
Musk has said since taking over Twitter that he intends to model the company's compensation plan after SpaceX, which is likewise privately held but allows employees to cash out a percentage of their shares to outside investors on a regular basis.
Restricted stock units, or RSUs, are the sort of equity that X is providing to its employees. These RSUs are earned over four years from the date of grant and require a "liquidity event," such as an IPO or company sale, to be taxed as income, according to internal documentation seen by The Verge.
Employees at X have been working there without knowing how much the company is worth since Musk bought it. This stock award data finally addresses that question, albeit it appears that Musk's valuation is still too high; one of his major investors, Fidelity, believes X is worth 65 per cent less than when he purchased it.
