Elon Musk’s SpaceX could be set to make its market debut soon, with some reports suggesting its prospectus could file any day now.
Tesla investors could reportedly get preferential access to shares of SpaceX, which is backed by Tesla and could be set to merge with the company next year.
There are a number of reasons why Tesla shareholders should care about SpaceX’s highly anticipated initial public offering, which could be right around the corner.
For starters, their fortunes could be increasingly tied through Tesla’s (TSLA) existing investments in the space startup. Tesla’s $2 billion investment in xAI was converted to SpaceX shares, the company disclosed earlier this month, in the wake of SpaceX’s acquisition of xAI.
Joint plans for a new chip factory have also deepened ties between Tesla and SpaceX, adding fuel to speculation they could be on the path toward a merger, after a series of recent consolidating moves by CEO Elon Musk. This year’s merger between SpaceX and xAI came just months after xAI merged with X last year.
Elon Musk’s Tesla and SpaceX are becoming increasingly tied together through investments and shared resources.
Wedbush analysts led by Dan Ives said they believe Tesla could join with SpaceX as soon as next year, viewing their chip factory plans and Tesla’s investments as laying the groundwork for a merger.
“Musk wants to own and control more of the AI ecosystem and step by step the holy grail could be combining SpaceX and Tesla in some way to give the connected tissue between both disruptive tech stalwarts,” they wrote in Friday note.
In the near term, SpaceX’s prospectus filing—which The Information reported could drop any day now—could reveal preferential access to the shares for Tesla shareholders. SpaceX and Tesla did not respond to an Investopedia request for comment in time for publication.
SpaceX, which is seen making its trading debut as soon as this June, is now expected to raise up to $75 billion, up from $50 billion previously. That could give it a $1.75 trillion valuation, according to Wedbush. (Tesla had a market capitalization of $1.35 trillion as of Friday afternoon.)
Space X logged about $8 billion in profits on $15 billion to $16 billion of revenue last year, Reuters reported, with its satellite-based internet system Starlink accounting for over half of its earnings before interest, taxes, depreciation and amortization (EBITDA).
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