Tesla And Spacex Form Committees To Consider Merger
Independent directors at both companies will review a possible combination, but no terms have been agreed and shareholder approval remains uncertain.
Tesla and SpaceX have each formed a special committee to consider a possible merger, Elon Musk said during SpaceX’s third-quarter earnings call, according to TechCrunch and The Verge. Musk, who is CEO of both companies, said shareholders requested the committees and that their members are independent directors. He supports exploring a deal but cautioned that a merger is not assured.
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Independent directors take up the proposal
Musk did not identify the directors serving on either committee. He said he is not taking part in their discussions because of his position at both companies. The committees have not agreed on terms for any transaction, the outlets reported.
TechCrunch noted that the companies have independent directors on their boards, but the existence of those directors does not establish who has been appointed to review the proposal. For now, the announced step is a review by the two committees, not an agreement to combine the businesses.
Shareholder approval remains a hurdle
Musk said any proposal developed by the committees would need shareholder support. He singled out Tesla’s voting requirement: approval would require votes representing 50% of all shares, rather than a majority of shares cast, according to The Verge. TechCrunch reported that Musk holds more than 50% of SpaceX’s voting power following its IPO, making shareholder support at SpaceX a different challenge.
The Verge reported that Barclays suggested in a client note earlier this month that a combination could be announced before Tesla’s annual shareholder meeting, scheduled for December 3, 2026. That suggestion is not an announcement by either company, and Musk has said the committees have yet to agree on transaction terms.
Why Musk favors a combination
Musk pointed to potential cooperation across AI software, chip development, robotics and connectivity. Both outlets also reported that he cited TeraFab, a chip-manufacturing project, and Starmind, SpaceX’s orbital AI data-center project, as areas relevant to a possible combination.
The Verge estimated that a merger could create a company valued at more than $3.6 trillion, while emphasizing that the structure of a deal would matter. If Tesla bought SpaceX, the outlet reported, issuing new shares could dilute existing Tesla shareholders, and SpaceX’s launch spending could compete with Tesla’s plans for car factories and battery plants. The Verge said many Wall Street analysts and legal experts instead expect SpaceX to acquire Tesla or absorb it through a stock swap, but noted that some Tesla shareholders could object. Neither structure has been agreed by the committees.
Sources
This story was compiled by AI from the reports below. Read the originals for the full details.