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Elon Musk’s Megadeal Between X and xAI Breaks Wall Street’s Rulebook [1]
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Date: 2025-04-01
The tech titan can follow his own rules when he is combining two companies he owns, but the merger is still raising dealmaker eyebrows
The new $80 billion valuation figure for xAI is a big jump from just four months ago, when the company was valued at $50 billion in its last fundraising. The new level was set as part of the merger talks, not in a new funding round.
“It’s funny money,” said Andrew Verstein, professor of law at the University of California, Los Angeles, Law School. “It’s like using Monopoly money to buy Pokémon cards.”
The deal is an all-stock transaction, so no cash is expected to change hands. X and xAI shares will be traded for stock in a new holding company, meaning the companies essentially agreed on an exchange rate for their shares.
excerpted from WSJ
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