Musk says Tesla and SpaceX formed merger committees, with traders split on a deal by June

Elon Musk said on SpaceX's earnings call on Tuesday that Tesla and SpaceX have each formed a special committee of independent directors to discuss a possible merger, CNN, Axios and NBC News reported. The committees were formed at shareholders' request, Musk said. He cautioned that a merger is not a certainty and that he is a conflicted party who is excluded from the talks.

Neither company has announced a merger. Traders remain split on whether one will be announced by the end of June, with the question sitting slightly on the favorable side of even. The committees are a step toward a deal but not an announcement of one. The question counts only an official statement that either company will be, is being or has been acquired by or merged with the other. A partial sale counts only if it hands over a controlling interest.

Expectations had already risen before Tuesday's call. The likely reason is a pair of developments last week. On Oct. 15, Tesla unveiled its next-generation Roadster at a SpaceX test facility, with SpaceX-developed thrusters on the car. The next day Axios reported that Barclays analysts see a Tesla-SpaceX tie-up as possible as soon as this fall. Neither company announced a merger, but the showcase and renewed talk of a near-term deal plausibly explain the move.

Bets held steady through the first week of October, edged up over the next few days, then eased in the middle of the month. They jumped on Friday and pushed a little higher on Saturday, the latest trading available.

Across markets with different deadlines, traders' central expectation for an announcement is early June, well ahead of late August when this story began. An announcement by the end of this year is seen as unlikely. One by the end of 2027 is likely, though the single most likely outcome is still that none comes by then.

Speculation has built since reports on Jan. 30 that SpaceX was weighing a combination with Tesla or xAI ahead of a planned stock offering. Barclays has said a deal could come before Tesla's annual meeting, which must be held by Dec. 6, or within six to 12 months. It sees SpaceX as the likely buyer in an all-stock deal.

Tesla's annual meeting is set for Dec. 3. Its proxy ballot lists only director elections, a vote on executive pay and auditor ratification, so a merger vote would likely need a separate special meeting. Barclays said an announcement in late October or early November would make shareholder approval at that meeting harder.

Musk said the committees may never reach an agreement. Any deal would need approval from shareholders at both companies and an antitrust review.