By Sandra Nwaokolo
Artificial intelligence company xAI, founded by tech entrepreneur Elon Musk, has secured a total of $10 billion in new funding, a major boost to its ambition of leading the next wave of AI innovation.
The new funding includes $5 billion in secured notes and term loans arranged by Morgan Stanley and an additional $5 billion in strategic equity investment obtained separately.
According to Morgan Stanley, the debt offering was oversubscribed, drawing interest from a consortium of prominent global debt investors.
The firm described the successful transaction as a vote of confidence in xAI鈥檚 long-term mission to 鈥渁ccelerate scientific discovery and advance humanity鈥檚 collective understanding of the universe.鈥
The funds are expected to power xAI鈥檚 ongoing expansion, including plans to build one of the world鈥檚 largest data centres and further develop its flagship AI platform, Grok.
The conversational AI tool is designed to compete with offerings from OpenAI, Google, and Anthropic.
Morgan Stanley said the combination of debt and equity financing will help reduce xAI鈥檚 cost of capital while broadening its access to long-term capital sources.
鈥淭his financing structure provides the company with greater financial flexibility as it scales its operations and AI infrastructure,鈥 the firm added.
鈥淲e are proud to partner with xAI in this milestone transaction. It underscores our commitment to supporting pioneering companies shaping the future of technology,鈥 Morgan Stanley said in a statement.
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