AI startup xAI acquires X in $33bn stock deal: Elon Musk

New Delhi:  Billionaire Elon Musk has announced his artificial intelligence company, xAI, has acquired social media platform X for an all-stock transaction of $33 billion.

The combination, which “values xAI at $80 billion and X at $33 billion ($45B less $12B debt),” will “unlock the immense potential”

It will blend “xAI’s advanced AI capability and expertise with X’s massive reach”. X has more than 600 million active users.

Musk had in 2022, bought X — originally Twitter — for $44 billion.

In the last two years, the platform “has been transformed into one of the most efficient companies in the world, positioning it to deliver scalable future growth”.

On the other hand, xAI, founded by Musk in March 2023, has rapidly become one of the leading AI labs in the world.

It builds models and data centers at unprecedented speed and scale, said Musk, who also leads Tesla and SpaceX and serves as an adviser to President Donald Trump.

“Today, we officially take the step to combine the data, models, compute, distribution, and talent,” said Musk.

He said the future if both xAI and X’s “are intertwined”, and “will deliver smarter, more meaningful experiences.

The combination “will allow us to build a platform that doesn’t just reflect the world but actively accelerates human progress”.

Calling it “just the beginning”, Musk also lauded the “hardcore dedication” of the people in both companies.

Meanwhile, Linda Yaccarino, X’s chief executive, wrote on X: “The future could not be brighter.”

Since Musk’s acquisition of Twitter in 2022, he made several changes to the company, including scrapping a free verified programme, introducing a paid membership and even changing the company’s name to X.

However, X’s financial outlook has not seen much growth. According to Fidelity, one of the investors that participated in Musk’s acquisition, X’s valuation plummeted to $12 billion in December, the New York Times reported.

In contrast, xAI has grown rapidly. The AI start-up raised $6 billion from investors in December, valuing it at $35 billion to $40 billion, up from $24 billion in May.

–IANS