March 2 (Reuters) - Elon Musk's social media platform X and artificial intelligence startup xAI plan to repay in full about $17.5 billion ‌in debt tied to the companies, Bloomberg News reported on Monday, ‌citing people familiar with the matter.

Morgan Stanley, which is managing the debt for both companies, ​has been informing existing lenders that X and xAI plan to pay back everything they owe, the report said.

Bloomberg reported that xAI's $3 billion of high-yield bonds are set to be redeemed at about $1.17 on the dollar, a premium reflecting ‌that the debt was ⁠expected to remain outstanding for at least two years.

The companies have not revealed where the capital is coming from, according ⁠to the Bloomberg report.

When companies repay bonds ahead of schedule they typically must compensate investors with a penalty plus the interest lenders had expected to earn ​over ​the original term.

Some of the debt has ​been outstanding for years, though ‌portions are less than a year old and carry penalties, Bloomberg said.

The repayment plans come after a series of major corporate moves.

SpaceX acquired xAI in February in a deal that valued the AI startup at $250 billion, giving the aerospace company greater flexibility to restructure xAI's capital.

The rocket maker is ‌preparing an initial public offering later this year, ​ahead of which Musk overhauled xAI's management ​last month.

xAI acquired X in ​2025, inheriting $12 billion of the social media company's debt ‌in the process.

Morgan Stanley subsequently led a $5 ​billion debt package ​for xAI, sources familiar with the matter told Reuters. In January, xAI raised $20 billion in a Series E funding round.

X and xAI did ​not respond to ‌requests for comment. Morgan Stanley declined to comment. Reuters could not ​independently verify the Bloomberg report.

(Reporting by Anhata Rooprai in Bengaluru; Editing ​by Alan Barona and Tasim Zahid)