Musk Backs Tesla-SpaceX Merger, Committees Form — SkimNews
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- Elon Musk endorsed a potential merger between Tesla and SpaceX during the latter’s earnings call, stating he believes it would be a good idea and revealing that both companies have formed special committees to explore a transaction.
- SpaceX holds nearly 80% voting control by Musk through 10-to-1 supervoting shares, making it a 'controlled company' with reduced Nasdaq governance protections for Class A shareholders.
- Tesla reported declining auto revenue and a steeper drop in its energy business, overshadowed by merger speculation, as Musk continues to pivot the company’s narrative toward robotaxis and Optimus robots despite limited progress.
- SpaceX has a market cap near $2 trillion compared to Tesla’s $1.5 trillion, meaning any stock swap would likely make SpaceX the acquiring entity and strengthen Musk’s control over a combined company.
- Eric Talley, a Columbia law professor, said a merger could resolve shareholder concerns over divided loyalties in AI and robotics initiatives between the two firms, potentially reducing litigation risk.
- Former Tesla board member Steve Westly believes the companies may move quickly to announce a merger proposal, possibly before the upcoming midterm elections, due to potential regulatory shifts.
Why it matters: A Tesla-SpaceX merger would consolidate Musk’s control over two trillion-dollar companies, but faces a high shareholder vote threshold at Tesla and steep regulatory scrutiny globally, especially in China, where Tesla earns 22% of revenue and SpaceX’s Starlink raises national security concerns.
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