Elon Musk says SpaceX and Tesla are exploring the largest merger in history

Elon Musk is weighing up the idea of potentially merging SpaceX and Teslainto one company.

Musk confirmed on Tuesday that his two largest companies have formed a special committee to examine and explore a merger, which would be the biggest in history if it comes to fruition. 

It has been reported that if SpaceX and Tesla merges then it could be worth a staggering $3 trillion. 

In June, the IPO of SpaceX was the largest of all time, raising an incredible $75 billion. 

It made Elon Musk the richest man in the world, and he has said that combining the resources of SpaceX and Tesla has a “lot of merit.”

He cited how both companies are investing heavily in AI, but did stress that the committees had not agreed on any proposal. 

During a SpaceX earnings call, Musk said that the merger will be presented to shareholders and voting on.

“They’ve got to come up with something, and then that’s got to be put to the shareholders as a vote.”

Musk, who has a net worth of over $900 billion did concede that the threshold to pass the merger is high, citing that 50 per cent is needed amongst Tesla shareholders. 

However, he did declare that he thinks the merging of SpaceX and Tesla is a good idea. 

“Some people out there assume that a SpaceX and Tesla merger is a certainty, and I think that would be overstating it. Do I think it would be a good idea? Yes. But at the end of the day, the shareholders have to be supportive of this.”

Mega merger

If the deal is given the green light by shareholders then it would represent the biggest corporate tie-up ever. 

The combination of SpaceX and xAI is currently on top spot with a market value of $1.25 trillion. 

Current valuations project that a fusion of SpaceX and Tesla would be worth around $3.5 trillion. 

SpaceX is the 7th largest company in the world, whilst Tesla sits just outside the top 10 in 11th place. 

Wall street

As aforementioned above, the IPO of SpaceX in June broke all records. 

Since reports started circulating that SpaceX may be merged with Tesla, shares in the space company rocketed by 8 per cent. 

Tesla shares gained 1.8 per cent, but the electric car colossus has been reinvigorated following the unveiling of its next-gen Roadster in Texas last week. 

On Tuesday, SpaceX reported a strong first quarterly profit, driven by strong growth in its AI and satellite-internet divisions.

Its net profit now stands at $4.4 billion in the July-September quarter, which represents a reversal from a $1.05 billion net loss a year earlier.