Musk's Two Giant Companies Are Studying a Merger
Could Elon Musk fold his two biggest companies into one? Not yet, but the talks are real. Tesla and SpaceX are worth about $3.5 trillion together, which would make a deal potentially the biggest merger ever.
On October 20, Musk said both boards had formed special committees to study a merger. They were set up at shareholders' request. He was quick to add that a deal is far from certain.
Here's the detail worth repeating to a friend. Musk owns about a fifth of Tesla, but he holds far more control at SpaceX through special voting shares. Barclays estimates that a SpaceX purchase of Tesla at current valuations would leave him with about 37% of the combined company but 56% of its votes.
Tesla is the harder sell. Musk says a deal would need the yes of half of all Tesla shares, not just the votes cast. Then Democrats won control of Congress, and Tesla and SpaceX shares each fell roughly 9 to 11 percent on one Thursday. Analyst Dan Ives still expects a deal, but he says it now faces a much tougher road.
Here's what to watch. Tesla holds its annual meeting on Thursday, December 3, at 3 p.m.. The bigger signal would be a formal deal from those committees. Bloomberg, citing people familiar with the matter, reports the goal is to announce one in the first half of 2027. Nothing is locked in, so the next few months are worth a look.
