Elon Musk’s SpaceX is gearing up for a major move as it seeks to partner with four prominent Wall Street banks to facilitate its anticipated initial public offering (IPO) on the stock market. This comes at a time when investors are bracing themselves for a surge of technology listings in the United States.
According to reports from both the Financial Times and Reuters, SpaceX is eyeing potential collaborations with financial giants such as Bank of America, JP Morgan, Goldman Sachs, and Morgan Stanley to spearhead its IPO efforts.
Notably, discussions were reportedly held last year regarding a private share sale that set SpaceX’s valuation at an impressive $800 billion (£591 billion), a significant increase from its earlier valuation of $400 billion just months prior. Furthermore, sources indicate that SpaceX is looking to raise an astonishing $25 billion, which would mark one of the largest global listings in history if it comes to fruition.
Last year, Musk, who holds the title of the world’s richest individual with a staggering fortune of $690 billion, projected that SpaceX’s annual revenue would reach $15.5 billion, with approximately $1.1 billion stemming from contracts with NASA, the American space agency. SpaceX earns money through various means, including the deployment of reusable rockets for missions that involve launching satellites and resupplying the International Space Station. Additionally, the company runs the Starlink broadband service, which has been gaining traction.
The news surrounding SpaceX’s IPO aspirations arrives amid predictions of a prosperous year ahead for tech listings in the U.S. Noteworthy companies like OpenAI, known for developing ChatGPT, and its AI competitor Anthropic are also generating buzz regarding potential IPOs, with reported valuations hitting $1 trillion and $350 billion, respectively. These upcoming offerings have been dubbed "hectocorns," referring to startups valued at over $100 billion.
Neil Wilson, an analyst at Saxo Capital Markets, mentioned that while Musk's ambitions to colonize Mars serve as a captivating narrative for SpaceX, investors are likely to focus more on concrete growth strategies, such as plans to establish solar farms and data centers in orbit.
In reference to the possible OpenAI IPO, Wilson commented, "SpaceX is bound to attract significant attention, but this will pose a substantial challenge for these AI IPOs. If OpenAI does go public, it will act as a litmus test for the entire sector—can we genuinely rely on a startup? Do the financial figures hold up?"
He further observed that the stock market has been riding high on the AI trend for the past two years, and it now faces a rigorous examination of its strength amidst some monumental IPOs that could determine whether the recent boom was merely a bubble.
Requests for comment were made to Morgan Stanley, Bank of America, Goldman Sachs, JP Morgan, and SpaceX.
