Elon Musk's Xai launched a $300 million stake sale, which the group values the $113 billion as the world's wealthiest people return to his business empire and race to develop artificial intelligence.
According to people close to this situation, the deal will enable employees to sell shares to new investors and verify the stock Pricetag encountered when Musk's XAI startup acquired his social media service X in March.
The secondary stock product, known as a tender offer, is expected to be a larger investment round, and the company will provide new equity for outside investors, one of the people said.
The March acquisition puts the entire group's acquisition value at $113 billion: XAI is priced at $8 billion and X is $33 billion. Musk bought X for $44 billion in October 2022, formerly Twitter.
Xai declined to comment.
The new stock sale comes after Musk helped Donald Trump's presidential campaign last week returned to the government's role in cost-cutting initiative. After clashing with the cabinet secretary and criticizing the central part of the Trump administration’s policy agenda, he ended in the so-called Department of Government Efficiency (DOGE).
Tesla and SpaceX chiefs said he will refocus on his business after his company suffered what he called a "strike back" in connection with the president.
"Back to work hours 24/7, sleep in the conference/server/factory room," Musk wrote on X late last month. "I have to be very focused on X/XAI and Tesla... because we have key technologies being launched."
Musk said the combined group will allow his two companies to benefit from combining models, computing power, issuance and talent. For example, AI developers can better train their own models on social media groups’ data and leverage audiences.
However, he did not disclose further details on how the March deal was structured. Opacity transactions allow X, which alienated some advertisers after adopting Musk's enablement method to control, to take advantage of the rising value of XAI.
AI startups received a $45 billion valuation late last year in a $5 billion private funding round. Last year Musk awarded investors who supported his Twitter acquisition of 25% of the shares.
Musk launched XAI in 2023 to reach out to Sam Altman's OpenAI and other large-scale technology competitors. It quickly launched the Grok chatbot and built a supercomputer cluster called Colossus, one of the largest AI data center projects in the United States.
In addition to competing with Big Tech and sometimes Grok’s rough image, Musk also agreed to the partnership. Last month, Microsoft announced that it was providing XAI models to its cloud computing customers, while messaging application Telegram agreed to distribute Grok to 100 million users.