Carl Icahn gained an estimated $250 million on his call to Musk.
The Wall Street Journal reported on Tuesday that the billionaire investor and Icahn Enterprises chairman invested hundreds of millions of dollars into the social-media company. Sources told the newspaper that he bought around 14 million shares in the mid-$30s.
In April, Musk agreed to buy Twitter for $54.20 a share, sending the company's stock price to that level. He tried to back out of the deal over the next few months, leading to a lawsuit. Icahn was able to purchase them at a steep discount.
After Musk relented and offered to complete his takeover of the company at the original agreed terms, the stock price of the company surged 22%. Assuming he hasn't sold it yet, Icahn's stake is worth about $750 million on paper.
According to The Journal, Icahn bought into the social networking site because he thought Musk would lose the court battle. According to the newspaper, the activist investor pegged the long-term value of the company at the mid-$30s.
Sources told the newspaper that DE Shaw, Dan Loeb's Third Point, and other high-profile investors have also bet on the stock of the company.
Icahn has made a lot of money investing in technology stocks. He missed out on tens of billions of dollars by selling his stakes in those companies.