‘Elon Thinking Big,’ Says Gene Munster As SpaceX Explores xAI–Tesla Tie-Up Ahead Of $1.5 Trillion IPO

Elon Musk has once again fueled merger speculation after reports said SpaceX is exploring a potential tie-up involving xAI and Tesla Inc. (NASDAQ:TSLA) as it prepares for what could be one of the largest IPOs in history.

SpaceX has reportedly been holding internal discussions around a possible merger involving Tesla and xAI.

The space exploration company is reportedly targeting an IPO as early as June at a valuation of around $1.5 trillion, a move that would instantly make it one of the most valuable publicly traded firms in the world.

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On Thursday, Deepwater Asset Management’s managing partner Gene Munster weighed in on X, calling the situation a classic example of “Elon thinking big.”

Munster outlined his view of how the scenario could play out over the next three years, assigning a 45% chance that Tesla acquires xAI, a 35% chance SpaceX buys xAI and a 20% probability that xAI remains independent.

“My take: Investors would likely approve the deal (either SpaceX or Tesla buying xAI) because it’s Elon thinking big, future versions of Colossus belong in space,” Munster wrote.

Reuters reports SpaceX is in talks to merge with xAI.
Over the next three years, I put the odds at:
* 35% that SpaceX buys xAI
* 45% Tesla buys xAI
* 20% xAI remains standalone.

SpaceX and Tesla have each invested $2B into xAI.

My take: Investors would likely approve the…

Both SpaceX and Tesla have already invested $2 billion each into xAI.

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In a separate post, Munster said Musk’s companies “will always play nice with each other,” outlining how each could benefit from xAI.

SpaceX, he said, wants xAI to power datacenters “in the sky,” while Tesla would leverage Grok, xAI’s chatbot, for Full Self-Driving software and the Optimus humanoid robot program.

“If SpaceX buys xAI, Tesla will still get access to Grok,” Munster added.

Elon’s company’s will always play nice with each other.
* SpaceX wants xAI for the datacenter in the sky.
* Tesla wants xAI for Grok for FSD and Optimus.
If SpaceX buys xAI, Tesla will still get access to Grok. https://t.co/UgvFkEoaTJ

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Investor Chamath Palihapitiya also took to X and said that a merger between SpaceX and Tesla would instantly create a modern-day Berkshire Hathaway.

“If this were to happen, it would also bring us one step closer to having one equity instrument for all things Elon which many would want to buy,” he said.

A merger between SpaceX and Tesla would instantly create the Berkshire Hathaway of the modern century.

The capital raising and operational efficiencies if both were together are obvious.

If this were to happen, it would also bring us one step closer to having one equity…

Prediction market Kalshi shows strong belief that SpaceX will announce an IPO before mid-2026.

Source: Kalshi

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