Did Tesla invest in SpaceX? Is buying TSLA before the IPO equivalent to buying SpaceX?

According to the latest documents from the U.S. Federal Trade Commission (FTC), Tesla has been approved to convert its investment in AI company xAI into a small stake in space exploration technology company SpaceX. This move symbolizes Elon Musk’s active restructuring of his extensive business empire. The share conversion primarily stems from the recent merger between SpaceX and xAI and serves as a financial prelude to SpaceX’s upcoming initial public offering (IPO).

Musk Sells Part of SpaceX Shares to Tesla

According to Bloomberg, Tesla has acquired a portion of SpaceX shares from Musk, who also sold some shares to investors including Valor Equity Partners and DFJ Growth. Transactions exceeding $133.9 million require review by the FTC, indicating that Musk’s corporate cross-holdings are gradually becoming institutionalized through compliant financial procedures.

Tesla previously invested $2 billion in xAI. After xAI merged with SpaceX in February this year, this funding was legally converted into less than 1% of SpaceX equity. This merger created a company valued at up to $1.25 trillion.

Musk’s Corporate Restructuring and IPO Strategy

The core purpose of this financial maneuver is to pave the way for SpaceX’s planned IPO. Market expectations suggest this could become the largest IPO in history. Musk is leveraging synergies across electric vehicles, social media, AI, and aerospace technology. The earlier merger of xAI with social platform X, valued at $33 billion, marked the beginning of this series of restructurings. Combining high-growth AI businesses with aerospace ventures that have hardware moats helps further boost overall valuation in the capital markets.

Buying TSLA Means Becoming a SpaceX Shareholder

From a macro market perspective, Tesla becoming a shareholder in SpaceX means its financial performance will indirectly bear the risks associated with aerospace and AI sector fluctuations. Although the stake is less than 1%, the close “related-party transactions” (business dealings between affiliated companies) will face stricter corporate governance scrutiny. For investors, SpaceX’s massive IPO could significantly “crowd out” stock market liquidity, requiring careful assessment of systemic changes brought by cross-sector integration of tech giants. However, for retail investors unable to participate in SpaceX’s IPO, holding SpaceX through Tesla is also an option.

Sources reveal that SpaceX is considering going public in June, around Musk’s birthday, and may seek to raise up to $50 billion. This would make it the largest IPO in history. Major roles are expected to be played by U.S. banks, Goldman Sachs, JPMorgan Chase, and Morgan Stanley.

This article, “Tesla Invests in SpaceX, Buying TSLA Before IPO Is Like Buying SpaceX,” first appeared on Chain News ABMedia.