Elon Musk’s financial team is reportedly working on a new financing strategy that could cut the hefty interest payments the billionaire has accumulated over the past few years. The plan comes after the merger of SpaceX and his AI venture, xAI, and is aimed at easing the nearly $18 billion debt stack that now hangs over both companies.
Most of that debt was built up through the $12.5 billion buyout of Twitter—now rebranded as X—and the $5 billion borrowing that followed the launch of xAI. The goal of the proposed deal is to lower the expensive interest burden ahead of a potential initial public offering, which is expected to take place later this year.
While details remain confidential, insiders say that a major financial institution that led the Twitter buyout will play a leading role in any new financing package. The same institution, along with a few other top banks, is also lined up to help steer SpaceX’s IPO.
The Twitter acquisition left the social media company with a large amount of debt that banks had to hold on their books after a turbulent start to Musk’s ownership. After months of uncertainty, the final portion of that debt—a $1.23 billion tranche—was sold off in April at a fixed 9.5% rate and a discount of 98 cents on the dollar. Other holders of the debt included several global banks.
Following the merger, xAI took on additional borrowing. Creditors, wary of the startup’s profitability and its appetite for cash, asked the company to refrain from taking on further debt. The merger itself was announced on February 2 and valued the combined social network at $45 billion, debt included.
Although no final decisions have been made, the move signals a concerted effort to streamline Musk’s finances and prepare both SpaceX and xAI for the next major capital‑raising event.
