3 min learnFeb 3, 2026 09:26 AM IST
Elon Musk stated on Monday that SpaceX has acquired his artificial-intelligence startup xAI in a record-setting deal that unifies Musk’s AI and area ambitions by combining the rocket-and-satellite firm with the maker of the Grok chatbot. The deal, first reported by Reuters final week, represents one of the crucial formidable tie-ups within the know-how sector but, combining a space-and-defense contractor with a fast-growing AI developer whose prices are largely pushed by chips, information facilities and vitality. It may additionally bolster SpaceX’s data-center ambitions as Musk competes with rivals like Alphabet’s Google, Meta, Amazon-backed Anthropic and OpenAI within the AI sector.
The transaction values SpaceX at $1 trillion, and xAI at $250 billion, based on an individual aware of the matter.
Buyers in xAI will obtain 0.1433 shares of SpaceX for each share of xAI as a part of the acquisition, this individual stated. Some xAI executives can also go for money as a substitute of SpaceX inventory at $75.46 per share, the individual stated.
“This marks not simply the subsequent chapter, however the subsequent guide in SpaceX and xAI’s mission: scaling to make a sentient solar to know the Universe and prolong the sunshine of consciousness to the celebs!” Musk stated. The acquisition of xAI units a brand new report for the world’s largest M&A deal, a distinction held for greater than 25 years when Vodafone purchased Germany’s Mannesmann in a hostile takeover valued at $203 billion in 2000, based on information compiled by LSEG. The mixed firm of SpaceX and xAI is predicted to cost shares at about $527 every, one other individual aware of the matter stated. SpaceX was already the world’s most respected privately held firm, final valued at $800 billion in a current insider share sale. XAI was final valued at $230 billion in November, based on the Wall Road Journal. The merger comes because the area firm plans a blockbuster public providing this yr that might worth it at over $1.5 trillion, two individuals aware of the matter stated.
SpaceX, xAI and Musk did not instantly reply to requests for remark.
The deal additional consolidates Musk’s far-flung enterprise empire and fortunes right into a tighter, mutually reinforcing ecosystem – what some traders and analysts informally name the “Muskonomy” – which already consists of Tesla, brain-chip maker Neuralink and tunnel agency the Boring Firm. The world’s richest man has a historical past of merging his ventures collectively. Musk folded social media platform X into xAI via a share swap final yr, giving the AI startup entry to the platform’s information and distribution. In 2016, he used Tesla’s inventory to purchase his solar-energy firm SolarCity.
The settlement may draw scrutiny from regulators and traders over governance, valuation and conflicts of curiosity given Musk’s overlapping management roles throughout a number of corporations, in addition to the potential motion of engineers, proprietary know-how and contracts between entities.
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SpaceX additionally holds billions of {dollars} in federal contracts with NASA, the Division of Protection and intelligence businesses, which all have some authority to evaluate M&A transactions for nationwide safety and different dangers.