Pierre Ferragu, a well-known analyst, has expressed his enthusiasm for the recent merger between Elon Musk’s xAI and X, valuing the combined entity at $113 billion. Ferragu, who has been a long-time advocate for Tesla Inc. and has invested in Grok, believes that this valuation will seem modest in the near future.
Reaction to the Merger
Ferragu reacted positively to the news of the merger, stating that the global town square is taking a massive step up. He added that the $113 billion valuation “will look tiny in a few years,” highlighting his bullish outlook on the growth potential of the merged companies. Ferragu also noted that he is biased and encouraged others to do their own research.
The Merger
The all-stock deal combines xAI, which was launched to rival ChatGPT-parent OpenAI, with X, formerly Twitter, which Musk acquired for $44 billion in October 2022. The merger will unify “data, models, compute, distribution, and talent” under a new holding company, xAI Holdings Corp. The move values xAI at $80 billion and X at $33 billion.
Elon Musk’s History of Mergers
Musk has a history of merging his own companies. In 2016, he leveraged Tesla stock to acquire SolarCity, his solar energy venture. His other privately held enterprises include SpaceX, which focuses on rocket technology; Neuralink, a company developing brain-implant chips; and The Boring Company, specializing in tunnel construction.
Growth Potential
Ferragu’s prediction suggests that the merged entity has significant growth potential. With the combined resources and expertise of xAI and X, the company is well-positioned to dominate the market. As the global town square continues to evolve, the merged entity is expected to play a major role in shaping the future of social media and artificial intelligence.
Conclusion
The merger between xAI and X is a significant development in the tech industry. With a valuation of $113 billion, the combined entity is expected to have a major impact on the market. Pierre Ferragu’s prediction that the current valuation will seem “tiny” in comparison suggests that the growth potential of the merged entity is vast. As the company continues to evolve and expand, it will be interesting to see how it shapes the future of social media and artificial intelligence.