Telegram's new move: plans to issue $1.5 billion in bonds, will integrate xAI owned by Musk and gain equity and subscription revenue share.

Compiled by: Felix, PANews

On May 29, sources revealed that the instant messaging app Telegram will raise at least $1.5 billion through bond issuance. In addition, Telegram's founder announced that a $300 million deal has been reached with Musk's xAI (yet to be finalized).

Driven by a series of positive news, the price of TON, the native token of Telegram's The Open Network, soared for a short time. According to CoinGecko data, Toncoin (TON) surged as high as about $3.7, an increase of about 23%, and is now trading at $3.32. Although Musk later clarified that the agreement had not yet been formally signed, and the price of the coin retreated, the 24-hour increase still reached 11.2%.

! Telegram's new move: Plans to issue $1.5 billion in bonds, will integrate Musk's xAI and receive shares and subscription shares

proposed to issue bonds to raise 1.5 billion dollars

Insiders revealed that Telegram will issue five-year bonds with a yield of 9%. The company plans to use the proceeds from this bond to repurchase its remaining bonds issued in 2021, which will mature in March next year. The company had previously repurchased about $400 million of such bonds with cash.

Investors include existing Telegram bondholders such as the U.S. asset management firm BlackRock and the Abu Dhabi sovereign wealth fund Mubadala. New investors are expected to include hedge fund companies like Citadel.

Like the bonds previously issued by Telegram, if the company decides to go public, investors in the new bonds can choose to convert their debt into stock at a discount. However, given the legal uncertainties faced by founder Pavel Durov and market volatility, the company is unlikely to conduct an IPO in the short term.

has reached a cooperation intention with xAI, which allows for equity and subscription sharing

In addition to the planned issuance of $1.5 billion in bonds, Pavel Durov stated on the X platform that Telegram will also gain a new source of revenue: a one-year agreement to distribute Elon Musk's xAI artificial intelligence model Grok (which integrates the Grok chatbot into Telegram). In return, Telegram will receive $300 million in cash and equity in the AI company, as well as 50% of the subscription revenue from xAI sold through Telegram.

In addition, Pavel Durov emphasized privacy. Some users expressed: "I hope user data can remain secure." In response, Pavel Durov stated: "User privacy is crucial. It needs to be clarified that xAI will only access data that Telegram users explicitly share with Grok through direct interaction."

It is worth mentioning that later that day, Musk denied the statement, replying that "no agreement has been signed yet." Following the news, the price of the TON token fell sharply. In response, Pavel Durov stated, "That's right, I agree in principle, but the formal procedures are yet to be completed."

Founder's investigation but revenue momentum is strong

Pavel Durov was born in Russia and holds citizenship in Russia, the UAE, and France. In August 2024, Pavel Durov was arrested in France for failing to assist the police in fighting crime and is currently under investigation in France. Although Pavel Durov has been released on bail, he is not permitted to leave France without permission during the investigation.

Pavel Durov applied for a special exemption on May 12 to travel to the United States to negotiate with investors, but French prosecutors stated that the request was denied because the reasons for his trip were "neither convincing nor reasonable." It is currently unclear how long Pavel Durov will be detained in France.

It is worth mentioning that, despite the legal risks faced by founder Pavel Durov, the development of Telegram has not been significantly affected.

According to informed sources, Telegram has informed investors that its revenue for 2024 is expected to be $1.4 billion, with a profit of about $540 million, a significant rebound from the previous year's poor performance. Telegram's revenue in 2023 was $342 million, with a loss of $173 million.

In addition, Telegram executives stated that by March 2025, Telegram will have 1 billion active users, with over 15 million paying users, doubling in the past year. Revenue is expected to reach 2 billion dollars in 2025, with profits exceeding 700 million dollars.

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