Elon Musk’s AI startup, xAI, has acquired his social media platform X, previously generally known as Twitter, in an all-stock deal, he introduced in a post on X Friday.

“xAI has acquired X in an all-stock transaction,” Musk stated. “The mix values xAI at $80 billion and X at $33 billion ($45B much less $12B debt).”

Musk went on to explain the 2 firms’ futures as “intertwined.” He added, “Right now, we formally take the step to mix the info, fashions, compute, distribution and expertise.”

The acquisition locations X — the extremely influential social media platform Musk bought in 2022 beneath its former identify, Twitter — firmly beneath the umbrella of Musk’s AI startup, which he based in 2023 to compete with OpenAI. Whereas xAI’s merchandise, together with its AI chatbot Grok, had been tightly built-in into the X platform earlier than this deal, Friday’s acquisition additional combines two of Musk’s most high-profile firms.

Based on publications together with The Wall Avenue Journal, shares of X and xAI will likely be exchanged for shares of a new holding company known as xAI Holdings Corp. The WSJ additionally reviews that executives at each firms believed that it will be simpler to boost cash for a mixed entity.

Musk — who additionally leads Tesla, SpaceX, and Neuralink — notes in his submit that this deal values X at $33 billion (lowered from an enterprise worth of $45 billion because of the firm’s $12 billion in debt). Musk initially bought X for $44 billion in October 2022 and took it non-public. Nonetheless, the valuation has swung dramatically lately. At one level, Constancy valued X at less than $10 billion.

Within the months for the reason that inauguration of President Donald Trump — for whom Musk aggressively campaigned and for whom Musk now serves beneath as a particular adviser main DOGE — X’s valuation has risen, largely as a result of buyers imagine the platform extra influential now. Musk stated in his submit on Friday that X has greater than 600 million lively customers.

Musk launched xAI in 2023 and has since beefed up the startup with industry-leading AI researchers from Google DeepMind, Microsoft, and OpenAI, and built out the massive AI data centers wanted to meet up with different frontier AI builders. To gas these efforts, Musk has gone on a historic fundraising marketing campaign, together with a $6 billion funding round in December that valued the startup at $45 billion. Based on Musk, xAI’s valuation is now even increased, at $80 billion.

xAI has largely been profitable in its mad sprint to meet up with OpenAI, Google DeepMind, and Anthropic. In February, the startup released Grok 3, a frontier AI mannequin that’s aggressive with the {industry}’s main AI fashions on benchmarks measuring math, science, and coding.

However xAI’s successes haven’t stopped Musk from meddling with OpenAI, a startup he co-founded with Sam Altman. Musk is presently attempting to thwart OpenAI’s for-profit transition — which it wants to finish to safe future funding — in additional methods than one. The billionaire proprietor of xAI has made OpenAI’s for-profit transition the centerpiece of his lawsuit against OpenAI. Musk additionally submitted a $97 billion takeover bid for Altman’s startup in February. OpenAI’s board promptly rejected the thought, but it surely already may have driven up the market price for OpenAI’s assets.

One of many main benefits that xAI has over OpenAI and different startups is its entry to X. The massive physique of posts that X has accrued through the years provides xAI a major benefit within the race for AI coaching information. Additional, X provides Musk’s AI startup an enormous client app to succeed in customers in.

Musk has a historical past of blurring the strains between his many firms, which has landed him in legal trouble before. With xAI’s acquisition of X, the 2 are actually successfully one — and the transfer means that X’s true worth might lie in advancing Musk’s broader AI ambitions.

This story has been up to date with further particulars in regards to the construction of the deal.