Elon Musk has opted to merge his AI firm xAI with his social media company X in an all-stock transaction. This decision has brought up the value for each company that now stands at $80B and $33B, respectively.
Musk shared how the future of both companies is now intertwined, shocking many after publishing the news through his X account. He added how the decision was taken in an effort to combine both companies’ models, information, distribution, talent, and computing capabilities.
The world’s richest person shared how this merger would give rise to huge potential for success and growth by combining xAI’s capabilities and talent with the reach that X possesses today. This purchasing price was highlighted to be $45B less $12B in debt.
Since both organizations are held privately and under the leadership of Musk, this transaction is most likely related to a share swap. So that means investors at X would be paid in share payments from xAI.
Remember, both tech giants have a huge number of mutual investors such as venture firms that include the likes of Kingdom Holding Co., Sequoia Capital, and Fidelity Management. X’s CEO Linda Yaccarino mentioned how this decision is huge and it represents something major where the future of X couldn’t be brighter.
Musk rolled out xAI nearly two years before, with the main goal related to being more linked to the actual nature. This startup, which Elon Musk co-founded in 2015 as a non-profit research lab, soon grew into a huge entity and was a major source of pride for the billionaire. This is because it came to life after he made a shocking decision to leave OpenAI and engage in legal battles with the tech giant.
For a while now, Musk’s xAI has been providing swift competition by rolling out its own array of LLMs, software products, and even taking on offers from Meta, Microsoft, OpenAI, and Google. After this merger, the xAI Grok would be up for grabs to all users on the X app.
We know more about the ambitious plans of xAI, which shared the desire to build a massive supercomputer in Tennessee for training its AI chatbot. Musk then shared a desire to have the Memphis supercomputer online, and so a component of that went live.
Both public and environmental advocates shared concerns about the startling speed of Memphis that arose without oversight from the general public and input from community members. The Colussus project is based on natural gas coming from turbines, which the company hopes to expand by developing another graywater facility in the vicinity.
The value for xAI was estimated to be about $50B during a financing round in 2024. There was a 75B valuation. The figures were low when compared to other leading tech giants in the industry, like Anthropic and OpenAI.
Furthermore, Musk has now made his debut in the world of politics and stands as a leading figure in the administration of Donald Trump. After rolling out nearly $300M for assistance, Musk was named head of the DOGE. It’s a controversial department that’s now eliminating jobs and reducing spending while replacing old laws with new debatable ones. So this new leading position certainly puts him in a position that could benefit all of his companies.
The merger is not the first time we’ve seen Musk take on such a business decision. In the past, he’s made some similar calls for other companies under his ownership, like combining Tesla with SolarCity.
Image: DIW-Aigen
Read next: Research Shows Balanced AI Usage Reduces Stress While Overuse Increases Dependence
Musk shared how the future of both companies is now intertwined, shocking many after publishing the news through his X account. He added how the decision was taken in an effort to combine both companies’ models, information, distribution, talent, and computing capabilities.
The world’s richest person shared how this merger would give rise to huge potential for success and growth by combining xAI’s capabilities and talent with the reach that X possesses today. This purchasing price was highlighted to be $45B less $12B in debt.
Since both organizations are held privately and under the leadership of Musk, this transaction is most likely related to a share swap. So that means investors at X would be paid in share payments from xAI.
Remember, both tech giants have a huge number of mutual investors such as venture firms that include the likes of Kingdom Holding Co., Sequoia Capital, and Fidelity Management. X’s CEO Linda Yaccarino mentioned how this decision is huge and it represents something major where the future of X couldn’t be brighter.
Musk rolled out xAI nearly two years before, with the main goal related to being more linked to the actual nature. This startup, which Elon Musk co-founded in 2015 as a non-profit research lab, soon grew into a huge entity and was a major source of pride for the billionaire. This is because it came to life after he made a shocking decision to leave OpenAI and engage in legal battles with the tech giant.
For a while now, Musk’s xAI has been providing swift competition by rolling out its own array of LLMs, software products, and even taking on offers from Meta, Microsoft, OpenAI, and Google. After this merger, the xAI Grok would be up for grabs to all users on the X app.
We know more about the ambitious plans of xAI, which shared the desire to build a massive supercomputer in Tennessee for training its AI chatbot. Musk then shared a desire to have the Memphis supercomputer online, and so a component of that went live.
Both public and environmental advocates shared concerns about the startling speed of Memphis that arose without oversight from the general public and input from community members. The Colussus project is based on natural gas coming from turbines, which the company hopes to expand by developing another graywater facility in the vicinity.
The value for xAI was estimated to be about $50B during a financing round in 2024. There was a 75B valuation. The figures were low when compared to other leading tech giants in the industry, like Anthropic and OpenAI.
Furthermore, Musk has now made his debut in the world of politics and stands as a leading figure in the administration of Donald Trump. After rolling out nearly $300M for assistance, Musk was named head of the DOGE. It’s a controversial department that’s now eliminating jobs and reducing spending while replacing old laws with new debatable ones. So this new leading position certainly puts him in a position that could benefit all of his companies.
The merger is not the first time we’ve seen Musk take on such a business decision. In the past, he’s made some similar calls for other companies under his ownership, like combining Tesla with SolarCity.
Read next: Research Shows Balanced AI Usage Reduces Stress While Overuse Increases Dependence
