The Elon Musk-led company is targeting a valuation of about US$1.5 trillion for the entire company. — Bloomberg
CALIFORNIA: SpaceX is moving ahead with plans for an initial public offering (IPO) that would seek to raise significantly more than US$30bil, sources say, in a transaction that would make it the biggest listing of all time.
The Elon Musk-led company is targeting a valuation of about US$1.5 trillion for the entire company, which would leave SpaceX near the market value that Saudi Aramco established during its record 2019 listing.
The oil major raised US$29bil at the time.
SpaceX’s management and advisers are pursuing a listing as soon as mid-to-late 2026, said some of the source.
The timing of the IPO could change based on market conditions and other factors, and one of the people said the timing could slip until 2027.
A representative for SpaceX didn’t immediately respond to a request for comment. SpaceX’s IPO plans sent shares in other space companies higher on Tuesday.
EchoStar Corp, which has agreed to sell spectrum licences to SpaceX, rose as much as 12% in New York, hitting a fresh intraday record. Space transportation company Rocket Lab Corp extended gains to as much as 4.3%.
Bloomberg and other media reported last Friday that SpaceX is exploring a possible IPO as soon as late next year.
Musk and the company’s board of directors advanced plans for the listing and fundraising – including hiring for key roles and how it would spend the capital – in recent days as SpaceX firmed up its latest insider share sale, one of the sources said.
SpaceX’s faster path to public markets is in part fuelled by the strength of its fast-growing Starlink satellite Internet service, including the promise of a direct-to-mobile business, as well as the development of its Starship moon and Mars rocket.
The company is expected to produce around US$15bil in revenue in 2025, increasing to between US$22bil and US$24bil in 2026, one of the people said, with the majority of sales coming from Starlink.
SpaceX expects to use some of the funds raised in an IPO to develop space-based data centres, including purchasing the chips required to run them, two of the sources said, an idea Musk expressed interest in during a recent event with Baron Capital.
In the current secondary offering, SpaceX has set a per-share price of around US$420, putting its valuation above the US$800bil previously reported, sources said.
The company is allowing employees to sell around US$2bil worth of stock, and SpaceX will participate in buying back some shares, two of the sources said.
The valuation strategy is designed to level-set the company’s fair market valuation in a precursor to the IPO, one of the sources added.
“SpaceX has been cash-flow positive for many years and does periodic stock buybacks twice a year to provide liquidity for employees and investors,” Musk said in a post Dec 6 on his social media platform X.
“Valuation increments are a function of progress with Starship and Starlink and securing global direct-to-cell spectrum that greatly increases our addressable market.”
SpaceX executives have repeatedly floated the idea of spinning off the Starlink business into a separate, publicly traded company – a concept President Gwynne Shotwell first suggested in 2020.
However, Musk cast doubt on the timing over the years, and chief financial officer Bret Johnsen said in 2024 that a Starlink IPO would be something that would take place more likely “in the years to come”. — Bloomberg
