# Musk-Trump Feud Risks xAI’s $5B Deal

High-Profile Clash Threatens Crucial AI Funding

The escalating feud between Elon Musk and former President Donald Trump may be boosting engagement on Musk’s X platform, but it’s creating serious complications for xAI’s $5 billion fundraising efforts. The timing couldn’t be worse for the artificial intelligence company, which recently merged with X and is now seeking substantial investment.

Merger Creates Financial Challenges

Earlier this year, Musk strategically merged X (formerly Twitter) with his AI venture xAI, aiming to create an integrated tech ecosystem. Bloomberg recently revealed the company’s ambitious plan to raise $5 billion through debt offerings arranged by Morgan Stanley, plus an additional $300 million in secondary sales.

Ill-Timed Social Media War

While the merger created potential opportunities for xAI, the timing of Musk’s very public dispute with Trump couldn’t have been worse. On the same day Morgan Stanley executives were pitching the xAI investment opportunity to potential backers, Musk and Trump were actively feuding on their respective social media channels.

Investor Concerns Surface

Market data shows the potential impact of this volatility:
– Morgan Stanley hoped to sell debt at 100 cents on the dollar
– Actual trading dipped to 95 cents during the height of the feud
– Investors reportedly demanded higher interest rates to offset risks

Wall Street insiders suggest this public drama may force Morgan Stanley to sweeten the deal with additional incentives to attract cautious investors. The situation underscores how personal conflicts among tech leaders can directly impact billion-dollar financing deals in today’s interconnected digital economy.

As xAI’s funding round progresses, all eyes remain on whether Musk can balance his public persona with the financial needs of his growing AI empire.