Musk-Owned xAI Raises $10 Billion through Debt and Equity Financing

BlockBeats News, July 1st, according to The Information, Morgan Stanley stated that Elon Musk's xAI company raised not only $5 billion in debt financing but also $5 billion in equity funding. Morgan Stanley is the advisor for this debt transaction but did not disclose the specific list of debt or equity investors.

Last December, xAI raised $6 billion from investors including Andreessen Horowitz, BlackRock, Lightspeed Venture Partners, and MGX to build an AI data center and enhance its ChatGPT-like product Grok. Subsequently, xAI acquired Musk's social media company X in an all-stock transaction, resulting in a post-merger company valuation of $113 billion.

According to a source familiar with the matter, this debt financing includes: $3 billion in bonds with a 12.5% yield, a $1 billion fixed-rate term loan at 12.5% interest, and a $1 billion term loan with an interest rate floating 7.25 percentage points above the benchmark rate, sold at a discount of $0.96 per dollar.