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Musk’s xAI startup raises up to $20 bln through Nvidia investments

Bloomberg reported that Nvidia is investing as much as $2 bln in the equity portion of the deal

NEW YORK, October 8. /TASS/. The xAI startup founded by Elon Musk, which developed AI-based chatbot Grok, is attracting significantly more financing than previously anticipated - up to $20 bln - thanks in particular to investments from the chipmaker Nvidia Corporation, Bloomberg reported, citing sources.

According to the agency, "Nvidia is investing as much as $2 bln in the equity portion of the deal," and the financing, which includes equity and debt, "will be tied to the Nvidia graphics processing units that xAI plans to use in its data center Colossus 2."

"xAI's financing would be split between about $7.5 bln of equity and as much as $12.5 bln of debt, and is structured through a special purpose vehicle that will be used to buy Nvidia processors," Bloomberg said.

Earlier on October 6, OpenAI, the world’s most valuable startup, valued at $500 bln, and AMD announced a five-year partnership to develop AI infrastructure. According to the chip manufacturer, the deal is expected to generate tens of billions of dollars in revenue for AMD over that period. Meta Platforms (designated as extremist in Russia) has also signed several multibillion-dollar agreements in recent months, including a $29 bln financing package for data centers.

In the US bond market alone, technology companies have raised approximately $157 bln this year, representing an increase of 70% compared to the previous year.