Elon Musk Merges xAI and X in $33 Billion Deal
Elon Musk has merged his artificial intelligence company xAI with X, the social media platform formerly known as Twitter, in an all-stock transaction that values X at $33 billion. Announced by Musk himself, the deal brings together two major pieces of his business empire and positions xAI to scale its AI operations by leveraging X's data, infrastructure, and user base.
The merger assigns xAI a valuation of $80 billion and X at $33 billion, a figure that reflects X’s $45 billion enterprise value minus $12 billion in debt, according to Musk’s post on X. Details of how the integration will unfold or how stakeholders from both companies will be affected remain unclear.
AI Synergies and Strategic Goals
Musk explained that the merger was designed to unify the companies’ strengths in data, computing power, talent, and distribution. "xAI and X's futures are intertwined," he posted.
The deal is seen by analysts as both strategic and symbolic. "It closes a chapter in the turbulent saga of X," noted analyst Paolo Pescatore, while others speculated that the $45 billion valuation figure was deliberately chosen to exceed Musk’s 2022 purchase price for Twitter by $1 billion, potentially sharing xAI's upside with co-investors in that deal.
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Consolidation Amid Competitive Pressure
The transaction also underscores Musk's growing influence in AI and technology policy. Alongside heading Tesla and SpaceX, he now leads several businesses with critical stakes in artificial intelligence. According to Reuters, as the current head of the so-called Department of Government Efficiency (DOGE) under the Trump administration, Musk also holds sway in regulatory circles, potentially smoothing the path for his ventures.
A current investor in xAI told Reuters that they were unsurprised by the move, describing it as Musk consolidating leadership across his companies. The investor said Musk had not requested shareholder approval before the deal but had assured them it would deepen integration with xAI’s AI model, Grok.
