SpaceX offer will be hard for Tesla to refuse
TSLA•Elon Musk said SpaceX and Tesla are discussing a potential merger that could create a $4 trillion company. SpaceX is valued at more than 1.4 times Tesla, while the columnist argues deal terms must protect Tesla shareholders’ voting rights and value.
1. Merger talks and control
Musk said SpaceX and Tesla have formed special board committees to discuss a potential merger. The companies share semiconductor and software ventures, but the column says a key motivation for Musk could be gaining control over the combined empire: he has 85% of the say at SpaceX and 18% at Tesla.
2. Valuation gap
Tesla would contribute 41% of the value in a merger, with SpaceX contributing the rest. SpaceX is now worth more than 1.4 times Tesla, after adding about $160 billion in market value following 830% year-over-year growth in its server-rental unit. Tesla trades at more than 200 times expected earnings, while Wall Street’s 2026 operating-income expectations have fallen 80% over two years.
3. Terms for shareholders
SpaceX could issue non-voting shares to acquire Tesla, but more than half of Tesla shareholders would need to vote for eliminating their voting rights in exchange for a stake in the combined company. The columnist says rejecting a deal without cash, a healthy premium or voting rights would be more rational.
