Tesla-SpaceX merger bets slide, with an announcement now expected around early October

Traders now expect a Tesla-SpaceX merger announcement around early October, later than the early May they expected when this story began. Bets on an announcement by the end of June fell sharply on Thursday, from likely to a toss-up.

The reason for the drop is not clear. No sourced development explains it, and no merger has been announced. Expectations across the different deadlines range from an announcement before the end of this year to none by the end of 2027. The single likeliest outcome is that nothing is announced by the end of 2027.

The slide followed a climb. Bets rose from roughly a toss-up to well above it in mid-October, after Tesla showed off its next-generation Roadster at SpaceX's Texas facility on Oct. 15. That day, Barclays analyst Dan Levy said a merger announcement before Tesla's annual meeting was one possible scenario. On Oct. 20, Elon Musk said both companies had formed special committees to explore a combination. He cautioned that a deal was not certain and that Tesla shareholder approval could be a hurdle, Axios reported.

Odds peaked around Oct. 23 and eased through the weekend. They dipped on Monday and held steady on Tuesday. They rose again late Wednesday and Thursday morning, then dropped through Thursday afternoon and evening, leaving them well below where they started the day.

Other deadlines show a mixed picture. A merger announcement by the end of this year looks unlikely, as does one by the end of January. A deal by the end of February sits at a toss-up, having risen since the story began. An announcement by the end of 2027 still looks likely.

The companies have confirmed little. SEC filings show both formed committees. SpaceX said no determination had been made, and Tesla said its committee was exploring a broader relationship that could include a business combination. Both said there was no assurance of a deal. JPMorgan has outlined a possible all-stock deal, and Reuters reported on Oct. 22 that Musk's public endorsement might complicate or slow talks. Bloomberg's Oct. 27 report found no agreement or new committee decision.

Tesla's annual shareholder meeting is scheduled for Dec. 3. Its proxy materials do not show that a merger proposal will go to shareholders. The filings give no timetable or terms. The next steps would be a committee recommendation, an agreement or other official company disclosure, and any required shareholder approvals.