FT called the deal on the merger of Tesla and SpaceX bet “va-bank” on AI

The deal to merge Tesla and SpaceX billionaire Elon musk is a bet “every bank” on artificial intelligence (AI), writes the Financial Times (FT).

The deal, which could have been the largest merger in history, would have opened up access to colossal payouts and consolidated most of Musk’s business interests in one public company.

The FT says the deal “could define an era in the history of technology and the stock market.” The newspaper points out that for supporters of the billionaire, it would mean the birth of a new conglomerate of the XXI century, in the center of which is AI, and the leading positions are occupied by industries from space exploration to robotics.

“It gives investors strong emotions: what they do determines the future. “A company of this magnitude has never existed before,” said Jean Munster, managing partner at Deepwater Asset Management.

In the event of a merger, Musk would consolidate his control of the empire. A FT source close to Tesla’s board of directors said SpaceX would “certainly” gain 85% control through the stock. As a result, the billionaire would get a controlling stake in the combined company, which would put an end to legal disputes with shareholders.

“Shareholder approval is required for everything. The rejection of this system is not the main reason for the deal, but it is definitely a huge advantage, the source said.

At the same time, according to the newspaper, the combined SpaceX may face skepticism, as investors often evaluate conglomerates with concern that their management will be worse concentrated on individual areas or will be less effective than in the allocation to several companies.

The fact that SpaceX is considering the possibility of combining with Tesla or an alternative deal with an entrepreneur-owned startup in the field of artificial intelligence xAI, Bloomberg wrote in January.

The possible merger was considered in the context of SpaceX’s plans to place data centers in space for AI computing. In this case, xAI could gain access to the company’s computing power, and Tesla could supply energy storage systems to power the centers. Among other prospects discussed was the use of Starship rockets to deliver Tesla Optimus robots to the moon and Mars.

In early February, SpaceX announced the purchase of xAI. According to Bloomberg, the value of the combined company was estimated at about $ 1.25 trillion, and the price of one share was $ 527.

The Financial Times estimated the possible cost of a combined Tesla and SpaceX at about $3.6 trillion. Among the potential benefits of the deal, the newspaper called the combination of developments in the field of AI, computing power and physical devices, as well as eliminating questions about the distribution of attention and resources of Musk between companies.

Later, Elon Musk supported the idea of combining companies. The boards of both companies have set up ad hoc committees of independent directors to consider a possible deal, he said.

“Do I think this is a good idea? Yes, Musk said. At the same time, he stressed that he will not participate in the discussion of the transaction, since he is an interested party.