Elon Musk's AI startup Xai has secured $5 billion in debt financing along with $5 billion in strategic equity investments, according to Morgan Stanley.
The fund will support the company's plans to expand its AI infrastructure, including new data centers, as competition in the AI sector becomes more intense.
The $5 billion raised in debt consists of secured bonds and term loan financing, with Morgan Stanley posted in a statement posted on social media platform X. The transaction is over-rised and includes prominent global debt investors.
Reuters previously reported that Xai is on track to shut down a $5 billion debt hike led by Morgan Stanley, despite lukewarm investor demand. In another report, Bloomberg News said Xai is in talks to raise $4.3 billion through equity investments in addition to its $5 billion debt financing plan.
Xai did not immediately respond to Reuters requests for comment outside of normal business hours.
The revenues will support Xai in the ongoing development of AI solutions, data centers and its flagship Grok platform, the bank said.
Apart from selling debt, Xai is in talks to raise about $20 billion in stock, which values a company worth more than $120 billion, with some investors valuing it at $220 billion.
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