{"id":451625,"date":"2026-02-03T17:51:09","date_gmt":"2026-02-03T17:51:09","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/451625\/"},"modified":"2026-02-03T17:51:09","modified_gmt":"2026-02-03T17:51:09","slug":"musks-xai-spacex-merger-valued-at-1-25-trillion-the-biggest-ever","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/451625\/","title":{"rendered":"Musk’s xAI, SpaceX merger valued at $1.25 trillion, the biggest ever"},"content":{"rendered":"

\"Faber<\/p>\n

Elon Musk’<\/a>s rocket maker SpaceX<\/a> has acquired his artificial intelligence<\/a> startup xAI<\/a> in a deal that will value the company at $1.25 trillion, CNBC’s David Faber confirmed Tuesday.<\/p>\n

The record-setting transaction is the largest merger of all time and values SpaceX at $1 trillion and xAI at $250 billion, according to documents viewed by CNBC. <\/p>\n

Musk, who is also CEO of Tesla<\/a>, announced the deal in a blog post<\/a> on Monday, saying he’s creating “the most ambitious, vertically-integrated innovation engine on (and off) Earth, with AI, rockets, space-based internet,” and the X social media platform. <\/p>\n

The main reason for the merger, he said, is to better build “orbital data centers.”<\/p>\n

Bloomberg<\/a> previously reported the merger valuation.<\/p>\n

The deal comes ahead of a highly anticipated blockbuster initial public offering for SpaceX later this year. The Financial Times<\/a> previously reported the company is looking to raise up to $50 billion at a\u00a0valuation\u00a0as high as $1.5 trillion. <\/p>\n

The merger deal, which is structured as a share exchange, will convert a share of xAI into 0.1433 share of SpaceX stock. Documents show xAI at $75.46 per share and SpaceX at $526.59 a share. <\/p>\n

Bank valuation documents viewed by CNBC value SpaceX at between $859 billion and $1.26 trillion and xAI at between $219 billion and $294 billion.<\/p>\n

Another main reason for the merger is to provide more capital to xAI, which makes the Grok chatbot. <\/p>\n

The startup is burning through cash as it races to build out infrastructure against rival AI labs such as OpenAI and Anthropic. <\/p>\n

OpenAI was last valued at $500 billion in October and Anthropic<\/a> signed a term sheet last month for a round that valued it at $350 billion. <\/p>\n

By comparison, xAI was last valued at about $230 billion in a\u00a0$20 billion funding round<\/a>\u00a0closed last month. <\/p>\n

Musk, who was a co-founder of OpenAI and departed in 2018, created xAI in 2023. Its Grok AI tool has recently come under fire for allowing users to create sexualized images<\/a>, including of children.<\/p>\n

SpaceX<\/a>, which makes satellites and reusable rockets, is in position to benefit from the push to launch data centers in space to feed booming AI demand. <\/p>\n

The company is widely known for its Starlink satellite internet service and has contracts with the Department of Defense and NASA, supporting its moon missions<\/a>. <\/p>\n

News of SpaceX’s potential 2026 IPO first broke in December, with Musk calling a report about the planned offering “accurate”<\/a> shortly thereafter.<\/p>\n

The Financial Times previously reported that Musk is preparing the debut for mid-June to time with his birthday and a planetary alignment.<\/p>\n

\u2014 CNBC’s Lora Kolodny contributed to this story.<\/p>\n

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