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

On July 1st, according to The Information, Morgan Stanley announced that in addition to raising $5 billion in debt financing, Elon Musk's xAI company has also raised $5 billion in equity funding. Morgan Stanley was the advisor for this debt transaction, but did not disclose the specific list of debt or equity investors. XAI raised $6 billion from investors including Andreessen Horowitz, BlackRock, Lightspeed Venture Partners, and MGX in December last year 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 a combined valuation of $113 billion. According to a source familiar with the matter, this debt financing includes: a $3 billion bond 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 a benchmark interest rate raised by 7.25 percentage points and sold at a discount of 96 cents per dollar.