Musk’s public endorsement of a potential $3.5 trillion SpaceX-Tesla merger has raised concerns among people involved in talks, who fear it could invite shareholder scrutiny and delay the process by several weeks.
People involved in discussions say Musk’s public endorsement of a potential $3.5 trillion merger has created concerns about how well Tesla shareholders’ interests would be represented. The talks are at an early stage, and the companies have hired advisers.
SpaceX approached Tesla in recent weeks. The companies have discussed a SpaceX acquisition of Tesla or a merger under a new holding company, and are weighing forms of consideration including an all-stock deal, a person familiar with the talks said.
The concerns echo Tesla’s 2016 acquisition of SolarCity, which led to years of shareholder litigation over Musk’s role. Courts ultimately upheld that acquisition as fair, and Tesla directors settled allegations for $60 million. Musk has said he cannot take part in the special committees’ discussions because he is conflicted.
