SpaceX and xAI in Merger Talks Ahead of Planned IPO, Reuters Reports

SpaceX and xAI, both controlled by Elon Musk, are in talks to merge ahead of a potential SpaceX IPO targeted for June 2026, per Reuters. The combination would unite Grok AI, X platform, Starlink, and rocket operations under one entity. Two Nevada entities — K2 Merger Sub Inc. and K2 Merger Sub 2 LLC — were formed January 21, 2026, signaling preparatory steps. Musk has previously expressed interest in deploying xAI data centers in space via Starlink infrastructure. The move aligns with Musk’s consolidation strategy: SpaceX and Tesla each invested $2 billion in xAI in 2025. Last year’s acquisition of X valued xAI at $80B and X at $33B. SpaceX, founded in 2002, was last valued at $800B in secondary markets, making it the most valuable U.S. private company.