SpaceX acquires xAI in record-setting deal as Musk unifies AI and space ambitions

SpaceX has acquired xAI in a record-setting transaction, consolidating Elon Musk’s artificial intelligence and space businesses into a single platform. The deal, first reported by Reuters, values SpaceX at about $1 trillion and xAI at roughly $250 billion, according to people familiar with the matter, making it the largest merger and acquisition transaction on record.

Under the terms, xAI investors will receive 0.1433 SpaceX shares for each xAI share, with some executives able to opt for cash at $75.46 per share. The combined entity is expected to price shares near $527. The tie-up brings together SpaceX’s launch and satellite capabilities, including Starlink, with xAI’s Grok chatbot and AI development, potentially strengthening plans for data centers and AI services delivered from orbit.

The move further integrates Musk’s businesses as he competes with rivals such as Alphabet, Meta, Amazon, and OpenAI. Analysts say the deal could enhance SpaceX’s narrative ahead of a potential public offering later this year, while also raising governance and regulatory questions given SpaceX’s extensive U.S. government contracts.