Elon Musk said on Tuesday that SpaceX and Tesla have formed special committees to explore a possible merger that would create the largest corporate combination in history, valued at around $3.5 trillion.
The SpaceX and Tesla chief executive told investors on a SpaceX earnings call that the idea “has a lot of merit” because of the companies’ complementary work on artificial intelligence, though the committees have not yet agreed on any proposal.
“They’ve got to come up with something, and then that’s got to be put to the shareholders as a vote,” Musk said.
He cautioned against assuming a deal is inevitable. “Some people out there assume that a SpaceX and Tesla merger is a certainty, and I think that would be overstating it,” Musk said. “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.”
A merger would need approval from at least 50 percent of Tesla shareholders, a threshold Musk described as a “high hurdle.”
At current valuations, SpaceX and Tesla rank among the world’s largest companies, with a combined market capitalisation of about $3.5 trillion. Such a deal would far exceed the $1.25 trillion union between SpaceX and xAI earlier this year.
Jerayr Haleblian, a mergers and acquisitions expert at the University of California, Riverside, said the combination has “sound logic.”
“In some sense, the core of both businesses are expert manufacturing. From a technology transfer perspective, there should be significant flows of information between businesses,” Haleblian told Al Jazeera. “Both firms seem to have expertise in robotics, AI, energy infrastructure.”
SpaceX shares rose more than 8 percent in after-hours trading following Musk’s comments, while Tesla shares gained 1.8 percent.
The remarks came as SpaceX reported its first quarterly profit, with net income of $4.4 billion in the July-September period, driven by growth in its AI and satellite-internet businesses.
