Musk's xAI raises $10 billion through debt and equity financing

ChainCatcher news, according to The Information, Morgan Stanley stated that Elon Musk's xAI company has raised $5 billion in equity funding in addition to $5 billion in debt financing. Morgan Stanley is the advisor for this debt transaction but did not disclose the specific names of the debt or equity investors.

xAI raised $6 billion last December from investors including Andreessen Horowitz, BlackRock, Lightspeed Venture Partners, and MGX to build AI data centers and improve its ChatGPT-like product Grok. Subsequently, xAI acquired Musk's social media company X in an all-stock transaction, with the merged company's valuation reaching $113 billion.

According to a knowledgeable source, this debt financing includes: $3 billion in bonds with a yield of 12.5%, a $1 billion fixed-rate term loan with an interest rate of 12.5%, and a $1 billion term loan with an interest rate of 7.25 percentage points above the benchmark rate, sold at a discount of 96 cents per dollar.