On March 28, Elon Musk announced that xAI had acquired X in an all-stock transaction, raising the valuation of xAI to $80 billion and X to $33 billion.

“The future of xAI and X are intertwined. Today, we are officially bringing together data, models, compute, and people,” Musk wrote on X.

Bloomberg
xAI was founded by Elon Musk to compete with OpenAI. Photo: Bloomberg

He also asserted that the merger will unlock limitless potential by combining xAI's advanced AI capabilities and expertise with X's reach.

Since both are private companies and both belong to Musk, the transaction could be the equivalent of a stock swap, with investor X getting paid in xAI shares. The two also share many of the same investors, including venture capital firms Andreessen Horowitz and Sequoia Capital.

Musk, who also owns Tesla and SpaceX, acquired Twitter for $44 billion in late 2022, implemented drastic cost-cutting measures and renamed it X. “The future couldn’t be brighter,” wrote Linda Yaccarino, who Musk hired as CEO of X.

Musk founded xAI less than two years ago with the goal of “understanding the nature of the universe.” The startup competes directly with OpenAI, which Musk co-founded in 2015. He left OpenAI a few years later and has been in a legal and verbal battle with CEO Sam Altman.

At xAI, Musk's team develops large language models and AI products, competing with OpenAI, Google, Microsoft, Meta. xAI's Grok chatbot is available on X.

This isn't the first time Musk has merged two of his companies. In 2016, Tesla acquired SolarCity for $2.6 billion.

(According to CNBC)