Tesla-SpaceX: rumours of a 3,500 billion merger. What does the market think?
Musk has confirmed that the merger is under consideration. Here are the analysts’ initial reactions
Speculation about a merger between Tesla and SpaceX is gaining momentum after Elon Musk confirmed the establishment of independent committees tasked with assessing the deal. The merger would create a technology giant with a total market capitalisation of around 3,500 billion dollars, operating in the fields of artificial intelligence, robotics, satellite telecommunications and the space industry. According to Barclays, as reported by Reuters, the most likely scenario involves SpaceX acquiring Tesla through a share swap, without any cash outlay. The bank values the two companies at approximately $2,100 billion and $1,500 billion respectively, and believes the deal could be announced by the end of the year or within the next 6–12 months.
The main business rationale would be the integration of AI technologies, robotaxis, Optimus humanoid robots and the Terafab project for semiconductor production. Barclays also highlights the potential financial synergies: according to consensus estimates cited by the bank, Tesla could generate $12 billion in free cash flow in 2030, compared with an expected outflow of $17 billion for SpaceX, which is not forecast to achieve positive cash flow until 2031. The merger would therefore allow part of Tesla’s financial capacity to be used to support the space group’s substantial investments.
RBC Capital Markets also considers the merger to be compelling, particularly given the synergies in semiconductors, Megapack energy storage systems and AI infrastructure. The bank has raised its target price for Tesla from $475 to $500 per share, factoring in a premium linked to the potential deal. RBC speculates that SpaceX could offer Tesla shareholders a premium of 20–30 per cent, whilst its own modelling values the car manufacturer at around $480 per share and the combined group at around $3,740 billion.
Among other assessments, Yorkville Ives & Co. believes that, in order to secure shareholder approval, Tesla may need to offer close to $550 per share. However, significant obstacles remain, particularly in terms of governance and regulatory approvals. According to Barclays, Musk could control around 56 per cent of the voting rights in the new company, whilst holding only 37 per cent of its economic capital. The merger would also require shareholder approval and a careful examination of the regulatory and national security implications, given SpaceX’s military contracts and Tesla’s industrial presence in China. Despite strong market interest, no definitive agreement has yet been announced.
