Kingdom Holding Company (KHC), a Saudi conglomerate with investments in key sectors like hospitality, real estate, and equity, has acquired a $400 million stake in xAI Corporation. The ambitious artificial intelligence company, founded by Elon Musk and global engineers, aims to accelerate human scientific discovery by developing advanced AI models.
KHC confirmed the acquisition as part of xAI’s Series C funding round. This follows its $400 million investment in the Series B funding round. The financing, provided through internal resources, reflects KHC’s strategy of securing early stakes in emerging technologies.
xAI’s valuation increased significantly, reaching $45 billion during the Series C funding round, compared to $25 billion in Series B. Despite being a newly established entity without financial statements for the past three years, the company’s innovative approach has attracted major investors. Participants in the Series C round included the Qatar Investment Authority (QIA), Oman Investment Authority (OIA), Morgan Stanley, and BlackRock.
KHC’s Vision in AI Innovation
This transaction reinforces KHC’s strategic partnership with Elon Musk, adding to its long-term stake in X (formerly Twitter), held since 2015. KHC’s Prince Alwaleed bin Talal has become the second-largest shareholder in Musk’s companies, including X and xAI. This partnership aligns with KHC’s ambition to lead and innovate within the AI sector.
Following the announcement, KHC’s shares on the Saudi Stock Exchange rose by 0.44%, reaching 9.16 riyals. The Public Investment Fund (PIF), which owns a 17% stake in KHC, further bolsters the company’s financial influence.
xAI’s Collaborative Approach
xAI’s strategy involves close collaboration with Musk’s other ventures, including Tesla, SpaceX, and X, which boasts over 500 million users. By leveraging these partnerships, xAI is poised to redefine AI’s role in advancing technology and scientific exploration.
Funding rounds like Series C typically attract rapidly growing companies seeking additional capital for expansion. Compared to earlier funding stages, Series C rounds involve reduced risks, making them appealing to institutional investors. KHC’s participation underscores its confidence in xAI’s potential and the transformative power of artificial intelligence.
