Tesla and SpaceX Form Special Committees to Explore a Possible Merger, Musk Says
Musk said the independent-director committees were formed at shareholders' request and that no terms have been agreed.
Tesla and SpaceX have each set up special committees of independent directors to explore a potential combination, Elon Musk said on October 20 during SpaceX's third-quarter earnings call.
What was said
Musk called a merger "a good idea" but stressed that the decision rests with the committees. He said he is a conflicted party and is not taking part in their discussions. He said it is too early to know whether a deal will happen, and the committees have not announced any terms.
According to Fox Business, the committees were formed at shareholders' request, and shareholders would ultimately have to approve any transaction. Musk pointed to overlaps between the companies in AI software, chip design, robotics and connectivity as the rationale for studying a combination.
Timing and reaction
- Analyst view: Barclays, as cited by Reuters, suggested a deal could be announced as early as December. That is an analyst estimate, not a company statement.
- Market reaction: SpaceX shares rose as much as 8% in extended trading after the earnings report and Musk's remarks.
- SpaceX results: SpaceX reported its first profit as a publicly traded company. Musk also projected annual recurring revenue of $500 billion to $1 trillion by the end of 2027, a forward-looking claim the company has not substantiated in detail.
Context
The two companies are already closely linked. Tesla recently unveiled a second-generation Roadster that uses SpaceX-developed thrusters, and both depend on Musk's leadership and shared work on AI and autonomy. Musk holds a significant stake in each company and retains substantial voting control at SpaceX.
Neither company has published committee membership or a timetable. Any merger would require approval from both boards and shareholders, and could also draw regulatory review.
