Elon Musk’s artificial intelligence venture xAI is currently seeking to raise $5 billion through loans and bonds, facilitated by Morgan Stanley, amidst concerns related to his Twitter acquisition and deteriorating political ties with Donald Trump.
Details: Morgan Stanley is offering investors a $5 billion debt package, which includes a floating-rate loan at 700 basis points above the SOFR benchmark and priced at 97 cents on the dollar, or a fixed-rate option at 12%. This “best efforts” deal indicates the bank’s caution due to uncertain macroeconomic conditions, without guaranteeing the full raise.
The move comes after a previous $13 billion debt underwritten for Musk’s Twitter acquisition that took over two years to manage. Moreover, xAI is also reportedly pursuing an additional $20 billion in equity funding, positioning the company with a projected valuation between $120 billion and $200 billion.
