SpaceX-Tesla merger talks worry participants
By the AFREEQUE newsroom, based on Businessday
Elon Musk’s public comments on a possible $3.5 trillion merger of SpaceX and Tesla have worried participants in the discussions, who fear closer shareholder scrutiny and a delay of several weeks. The preliminary talks are considering several possible structures, according to sources familiar with the matter quoted by Businessday.
Elon Musk’s comments on a possible merger of SpaceX and Tesla, valued at $3.5 trillion, have worried some participants in the discussions, who fear greater scrutiny from shareholders and a delay of several weeks. Businessday reported the concerns, citing a person directly informed about the talks.
The discussions are at an early stage. According to three sources familiar with the matter quoted by Businessday, SpaceX approached Tesla in recent weeks. The companies are considering several structures, including a SpaceX takeover of Tesla or a merger under a new holding company, as well as different forms of payment, including an all-share transaction.
Musk, who leads both companies and is a major shareholder in each, told investors this week that the companies were considering the transaction and had set up special committees to assess it. Participants fear that his public statements could raise questions about the protection of Tesla shareholders’ interests. For some, the deal echoes Tesla’s 2016 acquisition of SolarCity, which led to several years of litigation over Musk’s role.
The merger talks follow the creation of independent committees by SpaceX and Tesla, announced on 20 October to examine the deal. The following day, Musk publicly discussed a merger between the two companies.
