SpaceX is reportedly considering a potential merger with the electric carmaker Tesla, or a tie-up with artificial intelligence firm xAI, as Elon Musk looks at options to consolidate his global empire.
The rocket company is examining the feasibility of a tie-up with Tesla or xAI before a huge potential stock market float, according to Reuters.
It emerged this week that the world’s richest person was considering a flotation that would value SpaceX at $1.5tn (£1.1tn) and would reportedly be timed for early summer to coincide with a planetary alignment and his birthday.
Musk turns 55 on 28 June, around the same time as Jupiter and Venus appear in close proximity to each other.
The multibillionaire’s blue sky plans for SpaceX include potentially putting datacentres in space to do complex computing for AI models, which could benefit xAI if the plans become a reality.
Tesla’s capability to manufacture energy storage systems could also prove useful for SpaceX, to use solar energy in space to run the datacentres.
Musk has also discussed using SpaceX’s Starship rockets to carry Tesla’s Optimus robots to the moon, and ultimately to Mars.
Two legal entities with the phrase “merger sub” in their names were set up in Nevada on 21 January, with Bret Johnsen, SpaceX’s chief financial officer, named as one of the executives.
On Wednesday, Musk announced that Tesla would discontinue production of its Model X SUV and Model S full-size sedan, a sign taken by investors that the carmaker was pivoting away from its core electric car business.
The model S and X factory in Fremont, California, would be converted to produce Tesla’s upcoming Optimus robot, Musk said.
The company’s most recent quarterly earnings report showed slumping vehicle sales and declining revenue as Musk pinned Tesla’s future on AI and robotics.
The earnings report described Tesla’s chaotic year as a “transition from a hardware-centric business to a physical AI company”.
Shares in the carmaker climbed as much as 4.5% in after-hours trading on Thursday, having fallen 3.5% during trading hours, valuing the company at about $1.56tn.
The potential flotation of SpaceX could seek to raise as much as $50bn, which would make it the biggest initial public offering of all time.
Musk is the biggest shareholder in SpaceX with a 42% stake, however he controls almost 79% of the shares with voting rights.
Other backers include employees and private investors, which hold around 30%, Founders Fund, which controls 10.4%, Fidelity Investments with 10.2% and Google Ventures at 7.4%.
In December, SpaceX’s Johnsen told employees that a potential IPO would help fuel an “insane flight rate” for the development of the Starship rocket and a potential base on the moon.
Donald Trump has said he wants to see a base on the moon before he ends his second term in office in January 2029.
