Morgan Stanley expands its investor base to raise $5 billion in debt for Musk's xAI.

According to Bloomberg, Morgan Stanley is reaching out to a broader investor base to boost demand for a $5 billion debt issuance by Elon Musk’s artificial intelligence startup xAICorp. The deal also sheds light on the impact of the conflict between Musk and US President Donald Trump. Morgan Stanley had already received more than $3.5 billion in subscription orders when it launched the debt offering early last week, according to people familiar with the matter. Some investors see this as a sign that the deal will soon be oversubscribed — a goal that has usually been easily achieved in previous Musk-related financings. However, as of Monday, demand had only risen to about $5 billion, so Morgan Stanley began reaching out to some small lenders that had not been approved to participate last week.