Tesla gets the green light for converting xAI investment into SpaceX
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The news: Tesla has received an approval from the US Federal Trade Commission to convert its investment in xAI into a small stake in SpaceX ahead of its planned initial public offering.
The context: The filings follows a previously announced USD2 billion ($2.81 billion) investment in xAI, which is being rolled over into SpaceX. The approval would list Tesla as the acquirer of the stake in SpaceX from Elon Musk, who is chief executive officer of both companies. The transaction would give Tesla a stake of less than 1%.
While the regulatory filings are required for transactions valued above USD133.9 million, further details including the size of the stakes were not disclosed.
The conversion reflects a broader reshaping of Musk’s business empire ahead of SpaceX IPO, which could be the largest in history, according to Bloomberg. Musk’s companies span from electric vehicles, rockets, artificial intelligence to social media.
Musk had acquired social media platform Twitter in 2022, later renaming it X and merged it with xAI in a USD33 billion deal. That deal paved the way for the SpaceX deal, which created an entity valued at around USD1.25 trillion when it was announced this February.
The source: Bloomberg
