Three of Elon Musk’s companies – SpaceX, xAI and Tesla – are in play for a possible merger. While talks appear to be in their early stages, this could ultimately lead to at least one company joining SpaceX, according to reports from Bloomberg and Reuters.
Two scenarios are developed. In one case, SpaceX and Tesla would merge, according to Bloombergciting unnamed insiders. In another case, SpaceX and aXI (which already owns Musk’s social media platform X) would merge.
According to reporting by Reutersa merger between SpaceX and xAI could happen ahead of a planned SpaceX initial public offering this year. This would bring together products like the Grok chatbot, the X Platform, Starlink satellites and SpaceX rockets under one company.
Company representatives from SpaceX and xAI have not publicly discussed this possibility. However, recent documents show that two new business entities were formed in Nevada on January 21, called K2 Merger Sub Inc. and K2 Merger Sub 2 LLC. This suggests that Musk is keeping all options open.
There are advantages to both scenarios. By combining the SpaceX and xAI companies, xAI could place its data centers in space, something Musk says he wants. A partnership between SpaceX and Tesla could also align the EV manufacturer’s energy storage business with the data center in space idea.
And both options – as well as a combination of all three companies – are consistent with Musk’s comments and recent actions to consolidate or at least share resources between them. Last year, SpaceX agreed to invest $2 billion in xAI The Wall Street Journaland earlier this week, Tesla (also led by Musk) revealed that it had also invested $2 billion in the AI startup.
Last year, xAI bought X in a deal that Musk said valued xAI at $80 billion and X at $33 billion. SpaceX, which has been around since 2002, reportedly launched a secondary sale that valued it at $800 billion, making it the most valuable private company in the US
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A recent report from the Financial Times shows that Musk wants to acquire SpaceX public in June. But again, Musk’s grand plans rarely happens on time.
This article was originally published at 10:30 a.m. PT. It has since been updated with new information about Tesla.
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