Elon Musk said on Friday that his startup XAI had merged with X, his social network, in an All-Stock transaction which values the artificial intelligence company at 80 billion dollars and the social media company at 33 billion dollars.
“The future of Xai and X are intertwined”, Musk, the richest person in the world, wrote In an article on X. “Today, we officially take the measure to combine data, models, calculation, distribution and talent.”
He added that the merger would be “unlocking a huge potential by mixing the Advanced capacity and expertise of XAI AI with the massive X” X “scope. The purchase price, he said, was 45 billion in debt of more than $ 12 billion.
Since the two companies are held and controlled by Musk, the transaction is likely to be an exchange of shares, investors X being paid in XAI shares. Companies have a number of mutual investorsincluding venture capital companies Andreessen Horowitz and Sequoia Capital, as well as Fidelity Management, Vy Capital and Kingdom of Saudi Arabia Holding Co.
Musk, who is also CEO of Tesla And SpaceX, acquired Twitter in an agreement estimated at around $ 44 billion at the end of 2022, implementing massive cost reductions and soon sueing X. Linda Yaccarino, which Musk hired as CEO of X, wrote in an article after Friday’s announcement, “the future could not be more bright.”
Musk launched XAI less than two years ago with a declared goal of “understanding the true nature of the universe”. The startup tried to compete directly with OpenAI, the very appreciated intermediary startup that Musk co-founded in 2015 as a non-profit research laboratory. Later, he left Openai and was recently involved in public relations and a legal spit with the company and CEO Sam Altman on the management it took.
At XAI, the Musk team has developed major language models and AI software products, taking Openai offers as well as Google,, Microsoft,, Meta and others. X and XAI have already been intertwined, with the XAI Grok chatbot available for users of the social media application.
In June, XAI announced that he would build a supercomputer in Memphis, Tennessee, to form Grok. And in September, Musc revealed Part of the Memphis supercomputer, now known as Colossus, was already online.
Defenders of environmental and public health have raised concerns about the tapered speed of Xai’s development in Memphis, citing a lack of contribution and community surveillance. Colossus is powered by natural gas turbines and XAI plans to extend and build a gray water plant Also nearby.
Investors estimated XAI at around $ 50 billion in a financing round last year. Bloomberg reported last month that the company was in talks to collect funds at an evaluation of $ 75 billion. OPENAI was about to finish a round in February at $ 260 billion, while the startup generating Anthropic AI was estimated at $ 61.5 billion in an agreement that concluded this month.
In addition to directing Tesla, Spacex and Xai and the supervision of X, Musk spent much of his time this year in Washington, DC, as the central figure of the second administration of President Donald Trump.
After contributing to nearly $ 300 million to help Trump and other Republican candidates and causes during the 2024 campaign, Musk was responsible for the Ministry of Government Effectiveness (DOGE), which eliminates the government’s jobs, spending and the end of regulations. It is a role that puts in Musk position to make changes that benefit its different companies.
This is not the first time that Musk has merged two of its entities.
In 2016, Tesla acquired Solarcity for $ 2.6 billion. The solar installer was founded by his German cousins, Lyndon and Peter Rive, and funded by Musk, who was chairman of the board of directors. The shareholders of Tesla continued later, alleging that the agreement was equivalent to a bailout of Solarcity and a violation of the fiduciary obligation which has personally enriched musk. The judges of Delaware who heard the dispute decided in favor of Musk and Tesla, and allowed the agreement to keep without any remuneration for the automotive manufacturer.
WATCH: X acquires xai
