Piousbox

In a surprising announcement made Friday afternoon in a tweet, Elon Musk said that he sold social media platform X, formerly Twitter, to his AI startup firm xAI for $45 billion in stock. The deal includes $12 billion in debt owed by X. With the transaction, xAI has a valuation of $80 billion said Musk in the tweet. That is double xAI's valuation of $40 billion used in a recent funding round that raised $6 billion for the startup that Elon launched in 2023.

From Zerohedge: Elon Musk secured a multibillion-dollar margin loan using Tesla stock as collateral to finance his acquisition of Twitter (now rebranded as X). In recent months, Tesla’s share price has been cut in half due to a confluence of factors—slowing EV demand amid high interest rates, shifting electric vehicle policies under the Trump administration, market volatility driven by trade tensions, and pressure from a coordinated NGO-driven color revolution known as “Tesla Takedown,” aimed at crashing the stock to trigger loan repayment obligations tied to Musk’s pledged equity. Volatility in Tesla shares left Musk heavily exposed to potential loan repayment thresholds being triggered - which was set to occur at or below $114 according to reports - until now.

Musk outlined xAI's acquisition of X:

• xAI has acquired X in an all-stock transaction. The combination values xAI at $80 billion and X at $33 billion ($45B less $12B debt).

• Since its founding two years ago, xAI has rapidly become one of the leading AI labs in the world, building models and data centers at unprecedented speed and scale.

• X is the digital town square where more than 600M active users go to find the real-time source of ground truth and, in the last two years, has been transformed into one of the most efficient companies in the world, positioning it to deliver scalable future growth.

• xAI and X's futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution and talent. This combination will unlock immense potential by blending xAI's advanced AI capability and expertise with X's massive reach. The combined company will deliver smarter, more meaningful experiences to billions of people while staying true to our core mission of seeking truth and advancing knowledge. This will allow us to build a platform that doesn't just reflect the world but actively accelerates human progress.

• I would like to recognize the hardcore dedication of everyone at xAI and X that has brought us to this point. This is just the beginning.