and the stock market gets restless

SpaceX is exploring two merger scenarios: joining with Tesla or xAI, as reported Bloomberg and Reuters citing sources familiar with the matter. This above all is a warning for those who currently have investments in one of Elon Musk’s companies, although it is also a situation that can generate a business earthquake. Perhaps the biggest stock market movement in history. We are going in parts to explain everything we know so far.

Two paths on the table. According to Bloomberg, SpaceX has internally discussed the viability of a merger with Tesla, pushed by some investors in the aerospace company. For its part, Reuters point that a combination with xAI is also being evaluated, which could materialize before the IPO scheduled for this year. Of course, it should be noted that none of the companies involved have publicly confirmed these conversations, and sources warn that no final decisions have been made.

Movements. Last year, SpaceX agreed invest $2 billion in xAI, according to The Wall Street Journal, and this week Tesla also revealed that it had allocated the same amount to the AI ​​startup, according to account the middle. On the other hand, it is worth mentioning that xAI acquired X (formerly Twitter) in 2024, in an operation that valued xAI at $80 billion and the social network at $33 billion, as Musk himself mentioned. Here we once again witness a circular economy movement among its companies, with consequences that remain to be seen.

The logic. There are several legs here. On the one hand, it is worth mentioning that Musk has a thorn in his side build data centers in space to feed AI, something he has expressed on several occasions. In this way, a merger with xAI would allow SpaceX to accelerate this project, taking advantage of xAI’s computing capacity for its in-orbit facilities.

In the case of a merger with Tesla, the move could serve well to leverage its ability to manufacture energy storage systems, something that could help SpaceX expedite the development of systems that use solar energy in space to power these data centers. Musk has also talked about using Starship rockets to transport optimus robots from Tesla to the Moon and Mars.

The interest of investors. Regardless of the path chosen, any deal could attract considerable interest from many investors, especially infrastructure funds or Middle Eastern sovereign investors, according to they count from Bloomberg. The outlet also relies on public documents in Nevada that show that on January 21, two legal entities were formed with the expression “merger sub” in their names. The name of Bret Johnsen, SpaceX’s chief financial officer, appears in these documents.

Between the lines. The operation raises some questions. If SpaceX acquires xAI, SpaceX shareholders could see their stake diluted. If Tesla buys xAI, its shareholders would effectively be financing a bailout of Musk’s other businesses. In any case, it is clear that the possible merger would raise several blisters.

The numbers at stake. SpaceX reached a valuation of approximately $800 billion by the end of 2025, according to counted TechCrunch, becoming the most valuable private company in the United States. Tesla has a market capitalization of around $1.56 trillion. According to BloombergSpaceX is contemplating an IPO that could value the company at around $1.5 trillion, possibly in June, close to Musk’s birthday and with a fundraising of up to $50 billion, which would make it the largest IPO in history.

Initial reaction. Tesla shares rose as much as 4.5% in after-hours trading after news the news from Bloomberg. Johnsen told employees in December that a possible IPO would help drive “a huge rate of flight” for the Starship rocket and a possible base on the Moon. Meanwhile, the media also says that Bank of America, Goldman Sachs, JPMorgan Chase, Morgan Stanley and Robinhood Markets are already positioning themselves to host the operation.

Cover image | Flickr (Ministry of Communications) and SpaceX

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