SpaceX and Tesla Form Committees to Explore Merger

Elon Musk said SpaceX and Tesla have formed special committees to explore a possible merger, while cautioning that the discussions are preliminary and no transaction terms have been agreed. Musk made the remarks during SpaceX’s earnings webcast on October 20. He said he believes combining the companies has merit, including potential cooperation in developing superintelligence software, but stressed that a deal is not certain. He also said he would not take part in the committee discussions because he is a conflicted party. The committee process is a formal step toward considering a combination of Musk’s two companies, but does not establish that either company will pursue or complete a merger. The companies have not announced agreed terms. Musk said the decision would be up to the committees and shareholders. He said Tesla would need approval from 50% of all shareholders for a merger to proceed, rather than a majority of those who vote. That threshold was described by Musk during the webcast; the available information does not independently establish the applicable approval requirements. A merger would bring together Tesla’s electric-vehicle, energy and robotics businesses...