Elon Musk's SpaceX is taking over his artificial intelligence (AI) start-up, as the billionaire continues to unify some of his many business interests.
SpaceX confirmed the deal to acquire xAI, a smaller firm known for its Grok chatbot, posting a memo from Musk about the merger on its website.
In the note, Musk said the combination would form an 'innovation engine' putting AI, rockets, space-based internet, and media under one roof.
Terms of the deal were not disclosed. However, a source familiar said it valued xAI at $125bn (£91bn) and SpaceX at $1tn, making it the most valuable private company ever.
Last month, Musk's electric car company, Tesla, also announced it had invested $2bn into xAI.
Musk told Tesla investors at the time that he envisioned xAI functioning as an 'orchestra conductor' for Tesla factories employing autonomous robots.
SpaceX is also reported to be working on plans to list its shares for public trading.
Emily Zheng, a senior analyst at Pitchbook, said the deal for xAI has all the markings of a company preparing for public listing. This consolidation reflects a strategic move in anticipation of an IPO while considering the complexities of operational costs in the AI field.
Musk believes the future of AI is in space, suggesting that launching satellites will be a priority of the merger. He envisions this approach to help scale AI capabilities and ultimately support colonization efforts on Mars and beyond.
Now, only Neuralink and The Boring Company remain under separate management as Musk centralizes his technology enterprises.
