SpaceX applies for IPO under seal

Elon Musk's conglomerate SpaceX has formally initiated the long-awaited IPO. The corresponding application has been filed as a confidential matter, reports the business news service Bloomberg, citing unnamed insiders. Behind the secrecy, there is likely no sinister intention, but rather the hope for open and undisturbed communication between the company's representatives and the US Securities and Exchange Commission (SEC). After all, it's about the biggest IPO of all time (GröBaZ).

The intention for the IPO has long been no secret. The company controlled by Musk is expected to be valued at around two trillion US dollars. Although only a small portion is to be sold, even with 50 or 75 billion US dollars, it would be the largest IPO in history.

Not just rockets and satellites

The merger of other Musk companies with SpaceX indicated that it is now coming to fruition: In February, SpaceX took over xAI, also under Musk's control. This includes the controversial chatbot Grok and the social network X, formerly known as Twitter. Musk's Twitter purchase was a financial disaster, which was dissolved, like Russian nesting dolls, first into xAI and now into SpaceX.

Because SpaceX is said to be highly profitable. SpaceX let it be known to Reuters at the beginning of the year that it had generated 15 to 16 billion US dollars in revenue the previous year and kept half of it as profit. Whether this is accounting in the style of Elon Musk or according to recognized standards will be shown by the IPO prospectus. A draft is now available for review by the SEC (Securities Exchange Commission).

SpaceX certainly has a large lead in the satellite transportation market. Thus, a phalanx of major banks is preparing to organize the initial sale of shares in mid-year in the USA and other countries. Advertising is also part of the preparation: Musk came up with the outlandish idea of placing a million satellites as data centers in space. On Earth, SpaceX has invited analysts to a conference on April 21, and two days later they can visit an xAI data center. On May 4, they will be wooing the favor of non-directly involved banks, reports Bloomberg.

Risk of fraud

The hunger for SpaceX shares is undoubtedly great. For years, (supposed) options for acquiring SpaceX shares after its IPO have been sold on secondary markets. After all, private investors and employees have held shares or subscription rights for a long time, but cannot sell them. It will soon become clear whether all traded options will deliver what they promise.

Often, these are complex structures in which risk-takers participate in specially founded companies, which in turn participate in companies, which in turn... until someone at the end of the chain is supposed to have access to future SpaceX shares. Profits are practically guaranteed, but only for the intermediaries who collect fees.

Widespread FOMO (Fear Of Missing Out) attracts scammers. In 2023, a New Yorker was sentenced to 97 months in prison for selling fraudulent "purchase rights" for companies not yet listed on the stock exchange in 2020 and 2021. He extorted nearly six million dollars from his victims; they thought they had invested in companies like Airbnb, Palantir, Stripe, and SpaceX (USA v Iakovou, U.S. District Court for the Middle District of Georgia, Case No. 4:22-mj-00157).

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