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Elon Musk’s xAI Acquires X in $33 Billion Deal, Strengthening AI and Social Media Integration
Elon Musk’s xAI has acquired X (formerly Twitter) in a $33B deal, merging AI and social media. The move strengthens xAI’s chatbot Grok and deepens Musk’s tech empire.
ND
by News Desk
2025-03-29
Elon Musk’s xAI Acquires X in $33 Billion Deal, Strengthening AI and Social Media Integration

Elon Musk’s artificial intelligence company xAI has officially acquired X (formerly Twitter) in a deal that values the social media platform at $33 billion. This move is expected to boost xAI’s AI development efforts, particularly its chatbot Grok, while allowing co-investors to share in X’s value.

Musk confirmed the acquisition in a post on X, stating:

“xAI and X’s futures are intertwined. Today, we officially take the step to combine the data, models, compute, distribution, and talent.”

The deal values xAI at $80 billion and X at $33 billion (after subtracting $12 billion in debt from a total valuation of $45 billion).

Strategic Integration for AI Growth

Musk’s xAI, launched less than two years ago, has been positioning itself as a major competitor to Microsoft-backed OpenAI and other AI firms. The acquisition of X will allow xAI to:

✅ Leverage X’s massive real-time data stream for training AI models.
✅ Distribute AI products such as Grok-3, its latest chatbot.
✅ Expand supercomputer capabilities, including its Colossus AI cluster in Memphis, Tennessee.

Analysts believe the price tag of $45 billion (pre-debt adjustment) is no coincidence, as it’s $1 billion higher than Musk’s 2022 Twitter buyout, marking a strategic consolidation.

Investor & Market Reactions

Saudi investor Prince Alwaleed bin Talal, whose company Kingdom Holding is a major backer of both X and xAI, welcomed the deal, stating:

“After this deal, our investment value is expected to reach between $4-5 billion… and the meter is running.”

The seven banks that extended Musk’s original $13 billion loan to buy X have now successfully offloaded the debt, thanks to rising AI investor interest and X’s improved performance over recent quarters.

According to Pluris Valuation Advisors, investors who bought the debt will profit significantly post-merger.

Regulatory & Legal Scrutiny?

It remains unclear how X’s leadership will integrate with xAI or whether regulatory scrutiny will follow.

Additionally, Musk faces legal challenges, including a recent U.S. judge’s rejection of his bid to dismiss a lawsuit accusing him of defrauding Twitter shareholders by delaying disclosure of his initial investment.

OpenAI Rivalry Continues

Musk, who recently led a $97.4 billion bid for OpenAI (which was rejected), has also sued OpenAI to block its shift from a non-profit to a for-profit entity. Despite legal setbacks, Musk’s focus on AI dominance continues to intensify.

What’s Next?

With AI and social media now under one umbrella, Musk is cementing xAI’s future as a dominant force in the AI landscape. The integration of X’s data with xAI models could revolutionize AI-powered interactions, setting the stage for deeper social media-AI fusion.
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AI

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ElonMusk

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