SpaceX is reportedly exploring an initial public offering, setting off a range of possible scenarios for Elon Musk’s business empire.
- A series of reports on Thursday noted that Elon Musk is considering merging SpaceX with his other companies, including Tesla and xAI.
- The rocket firm itself is preparing for an initial publication, likely later this year.
- An early investor in Tesla, Chamath Palihapitiya, said a holding unit for Musk companies would be like a modern Berkshire Hathaway.
Elon Musk is reportedly restructuring the ownership of his companies to bring some or all of them under a single holding entity. If that happens, the resulting group would potentially be a “Berkshire Hathaway of the modern century,” an early Tesla investor said.
“It would also bring us one step closer to having one equity instrument for all things Elon, which many would want to buy,” Chamath Palihapitiya, founder of Social Capital, said in an X post on Thursday, responding to reports about SpaceX considering a merger with other Musk companies, such as xAI and Tesla.
Palihapitiya Called It Earlier
In fact, Palihapitiya predicted earlier this month that this merger could happen. He had said that instead of a SpaceX initial public offering, Musk might choose to merge it into Tesla.
Musk has long spoken about forming a holding company that could eventually house not just SpaceX and Tesla but also Neuralink, Starlink, and xAI. Among the group, only Tesla is currently listed.
To be sure, it is unclear whether Musk is pursuing a consolidation of his companies in place of a SpaceX merger, or merely a precursor. Reports point to the latter.
On Polymarket, a prediction platform, the odds of a Tesla-SpaceX merger by June have dipped 50% to 18% since reports first emerged.
Various Possibilities In Musk’s Consolidation Play
In any case, Palihapitiya’s Berkshire Hathaway analogy is fitting. The Omaha, Nebraska-based conglomerate is one of the most storied investors of the last century, with assets totaling over $300 billion.
Musk’s business empire spans space rockets, electric cars, satellites, social media, and frontier technologies like artificial intelligence, autonomous driving, and AI robots, and a combination could yield mouth-watering benefits and greater capital-raising efficiency.
However, whether Tesla will create wealth on par with Berkshire's remains to be seen. Berkshire’s Class A shares have delivered an eye-watering 6,100,000% in the six decades under Warren Buffett. Tesla's stock has returned over 32,000% to investors since its 2010 IPO.
Gloomy Outlook For Tesla
Stock market investors are closely watching developments for signals for the Tesla stock. On Stocktwits, retail sentiment for TSLA has been ‘extremely bearish’ since its quarterly report on Wednesday. The EV giant reported a largely expected 22% fall in fourth-quarter deliveries and said it would more than double the capital expenditure to $20 billion this year.
TSLA is down 7.4% so far in January.
For updates and corrections, email newsroom[at]stocktwits[dot]com.<
