San Francisco / Global Tech Desk: Elon Musk announced on Monday that SpaceX has acquired his AI startup xAI, uniting his space and artificial intelligence ambitions in a landmark deal. The merger combines the rocket-and-satellite company with xAI, maker of the Grok chatbot, in what experts say is one of the most ambitious tech tie-ups to date.
The transaction values SpaceX at $1 trillion and xAI at $250 billion. Investors in xAI will receive 0.1433 shares of SpaceX per xAI share, with some executives opting for cash at $75.46 per share. Musk described the merger as “not just the next chapter, but the next book in SpaceX and xAI’s mission: scaling to make a sentient sun to understand the Universe and extend the light of consciousness to the stars!”
The deal sets a new world record for mergers and acquisitions, surpassing Vodafone’s $203 billion takeover of Germany’s Mannesmann in 2000. The combined company is expected to price shares at around $527 each.
The merger strengthens Musk’s “Muskonomy,” consolidating his ventures including Tesla, Neuralink, and the Boring Company. Analysts say the integration of Starlink with AI services could create a powerful infrastructure platform for both commercial and government applications, including potential orbital data centers.
While the acquisition is strategically significant, it may attract regulatory scrutiny due to Musk’s overlapping leadership roles, governance concerns, and SpaceX’s federal contracts with NASA, the Department of Defense, and intelligence agencies.
This deal positions SpaceX for a potential blockbuster public offering later this year, which could value the company at over $1.5 trillion.