# Musk vs. Trump: Threat to xAI’s $5B Deal?
Public Feud Creates Investor Concerns for xAI
The heated social media battle between Elon Musk and former President Donald Trump has created unexpected turbulence for xAI‘s ambitious funding plans. While the dramatic online exchanges initially boosted engagement on Musk’s X platform, financial analysts now question whether the conflict could derail xAI’s critical $5 billion debt offering.
Merger and Funding Strategy at Risk
Earlier this year, Musk strategically merged his artificial intelligence venture xAI with social media platform X (formerly Twitter). The move positioned xAI to leverage X’s massive user data for AI development. Financial documents reveal the combined entity is seeking:
– $5 billion in debt financing (led by Morgan Stanley)
– Additional $300 million through a secondary share sale
Timing Couldn’t Be Worse
The fundraising effort collided dramatically with Musk and Trump’s public falling out. According to The Wall Street Journal, Morgan Stanley was actively pitching xAI’s debt offering to institutional investors at the exact moment the billionaire and former president were:
» Trading personal attacks on their respective platforms
» Escalating their disagreement into a full-blown public feud
Market Response Rattles Deal Structure
The controversy immediately impacted investor appetite:
- Debt initially offered at 100 cents on the dollar traded at 95 cents
- Morgan Stanley may need to sweeten terms with higher interest rates
- Some institutional buyers expressing new hesitation about xAI’s stability
Financial analysts suggest the high-profile conflict introduces unnecessary risk factors into what was already a complex funding scenario. With AI development requiring massive capital investments, the timing of this feud threatens to undermine xAI’s ambitious growth trajectory at a critical juncture.