Musk says SpaceX and Tesla have set up committees to study a possible merger
In short
Elon Musk said on 21 October that special committees at SpaceX and Tesla, formed at shareholders' request, are discussing a possible merger. He called it a good idea but said he cannot take part because of a conflict of interest and that a merger should not be seen as inevitable.
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Elon Musk said that special committees have been formed at SpaceX and Tesla to examine a possible merger of the two companies. He spoke on 21 October, answering a question at the conference on SpaceX's third-quarter results. iXBT, 3DNews and Interfax reported that the committees were formed at shareholders' request. [ 1 , 3 , 7 ]
Musk said he cannot take part in the committees' discussions because of a conflict of interest. 3DNews wrote that the committees include independent directors of both companies, whose names Musk did not disclose. Vedomosti, citing Bloomberg, reported that the committees have not yet agreed terms. [ 2 , 3 ]
Asked whether he thinks a merger is a good idea, Musk answered "Yes" but said it should not be considered inevitable and that shareholders must ultimately support it, according to iXBT. According to 3DNews, he said that for Tesla it would take votes from 50% of all shares, not only voting ones, which he called a hard hurdle to clear. Interfax quoted him as saying the decision would be taken by the special committees, and added that the committees may never agree terms. [ 1 , 3 , 7 ]
Musk said a merger would bring many benefits, in particular in software for AI, chip design and robotics, according to Interfax, Kommersant and TASS. Interfax added that the two companies already cooperate on chips in the Terafab project, and that Musk expects it to release a first test chip in May-June next year and to begin serial production by the third quarter of 2028. [ 4 , 6 , 7 ]
Vedomosti and RBC put SpaceX's value at about $2 trillion and Tesla's at nearly $1.5 trillion. Vedomosti, citing Bloomberg, wrote that a deal would combine Tesla's electric-vehicle, energy and robotics units with SpaceX's rocket-launch and satellite-internet unit. Interfax reported that SpaceX shares rose 9.8% in pre-market trading on Wednesday and Tesla shares 1.6%. [ 2 , 5 , 7 ]
On the results, Kommersant gave SpaceX's revenue growth as 161% to a record $14.5 billion, citing the Financial Times for the link to cloud-computing sales. Interfax gave revenue of $14.6 billion, up 2.6 times, and net profit of $4.4 billion against a loss of $1.1 billion a year earlier. [ 6 , 7 ]
Why it matters
The outlets describe SpaceX and Tesla as among the world's largest companies, valued at about $2 trillion and nearly $1.5 trillion. No terms have been agreed, and Musk said shareholders would have to back any deal.
Key facts
- Musk said special committees have been formed at both SpaceX and Tesla to discuss a possible merger. [ 1 , 2 , 3 , 6 , 7 ]
- Musk said he cannot take part in the committees' discussions because of a conflict of interest. [ 1 , 2 , 3 , 6 , 7 ]
- Musk said he considers a merger a good idea but that it should not be seen as inevitable. [ 1 , 5 , 6 , 7 ]
- Musk spoke at the conference on SpaceX's third-quarter results. [ 3 , 6 , 7 ]
- Musk named software for AI, chip design and robotics as areas where a merger could bring benefits. [ 4 , 6 , 7 ]
- SpaceX is valued at about $2 trillion and Tesla at nearly $1.5 trillion. [ 2 , 5 ]
- SpaceX shares were up 9.8% and Tesla shares 1.6% in pre-market trading on Wednesday, Interfax reported. [ 7 ]
Confirmed by several sources
- Special committees have been formed at SpaceX and Tesla to discuss a possible merger, Musk said. [ 1 , 2 , 3 , 6 , 7 ]
- Musk is not taking part in the committees' discussions because of a conflict of interest. [ 1 , 2 , 3 , 6 , 7 ]
- Musk said he thinks a merger would be a good idea. [ 1 , 5 , 7 , 8 ]
- Musk said it is too early to treat a merger as inevitable and that shareholders must ultimately back it. [ 1 , 3 , 6 ]
Still unclear
- Whether a SpaceX-Tesla merger will happen. Musk said the committees have not agreed terms and may never do so; Interfax and 3DNews report no agreements exist.
- Who makes the final decision. Interfax quotes Musk as saying the special committees will decide, while iXBT, 3DNews and Kommersant report him saying shareholders must approve it.
- SpaceX's third-quarter revenue figure. Kommersant gives a record $14.5 billion, while Interfax gives $14.6 billion.
- Who sits on the committees. 3DNews says they include independent directors of both companies whose names Musk did not disclose.
What local media are saying
Timeline, local time
- iXBT published Musk's comments on the possible merger. [ 1 ]
- Vedomosti reported, citing Bloomberg, that the committees had been formed. [ 2 ]
- 3DNews reported that the committees consist of independent board members. [ 3 ]
- TASS reported Musk's statement on a possible merger. [ 4 ]
- RBC reported that Musk called a Tesla-SpaceX merger a good idea. [ 5 ]
- Kommersant reported that SpaceX and Tesla are in merger talks, according to Musk. [ 6 ]
- Interfax reported Musk's comments, the Terafab chip plans and the pre-market share moves. [ 7 ]