Elon Musk has merged his aerospace giant SpaceX with his artificial intelligence company xAI in a deal valuing the combined entity at US$1.25 trillion, creating what would become the world’s most valuable private company as preparations intensify for a public listing later this year.
The transaction brings together SpaceX’s launch services, satellite manufacturing and Starlink broadband network with xAI’s fast-growing artificial intelligence capabilities, positioning the merged group as a vertically integrated technology and infrastructure powerhouse spanning space, communications and AI.
In a joint statement, the companies said the merger is designed to unify advanced rocket systems, space-based internet, direct-to-device connectivity and large-scale artificial intelligence under a single corporate structure. The combined entity is expected to play a central role in Musk’s long-term vision of building AI systems tightly integrated with global communications and space infrastructure.
The move clears the path for a blockbuster initial public offering that could value the group at up to $1.5 trillion, according to people familiar with the plans. If completed, the listing would eclipse previous IPO records and mark one of the largest public market debuts in history.
SpaceX, founded in 2002, has grown into the world’s dominant private space company, launching hundreds of rockets annually and operating the largest satellite constellation through Starlink. xAI, launched in 2023, has rapidly expanded its footprint in generative AI, positioning itself as a competitor to established players in large language models and real-time information systems.
Analysts say the merger could give the combined company a strategic edge by embedding AI directly into satellite operations, launch logistics, data processing and global communications, while also providing xAI with access to vast real-time data streams generated by space-based platforms.
The deal further consolidates Musk’s business empire, which also includes electric vehicle maker Tesla, brain-computer interface company Neuralink and tunnelling venture The Boring Company. It comes at a time of intense investor interest in artificial intelligence and space infrastructure, two sectors seen as critical to future economic and technological growth.
Regulatory approvals and final IPO timing are still subject to market conditions, but the merger signals Musk’s intent to take an integrated AI-and-space champion to public markets within months.
