Billionaire investor Bill Ackman on Saturday proposed merging SpaceX with Pershing Square SPARC Holdings, a special purpose acquisition rights vehicle created by his firm, Pershing Square Capital Management, that would give Tesla Inc. (NASDAQ:TSLA) shareholders priority access to invest in SpaceX. In a post on X, Ackman said the structure would distribute special purpose acquisition rights, or SPARs, to Tesla shareholders, allowing them to invest directly in SpaceX or receive cash for their rights. "This ...

Core Insights - Billionaire investor Bill Ackman proposed merging SpaceX with Pershing Square SPARC Holdings, allowing Tesla shareholders priority access to invest in SpaceX [1][2] - The proposal aims to reward Tesla shareholders and democratize the IPO process, aligning with Elon Musk's previous comments on ownership access for Tesla supporters [2] SPARC Structure Details - The proposed transaction would distribute 0.5 SPARs per Tesla share, resulting in approximately 1.723 billion SPARs outstanding, with each SPAR exercisable for two shares of SpaceX, totaling 3.446 billion shares [3] - The structure eliminates underwriting fees and maintains 100% common stock capitalization, with Pershing Square waiving its sponsor warrant rights [4] Capital Raising Flexibility - At an exercise price of $11.03 per SPAR, SpaceX could raise about $42 billion, with $38 billion from SPAR exercises and an additional $4 billion from Pershing Square; if the exercise price were $42, total proceeds could reach approximately $148.7 billion [5] - The structure allows flexibility between primary and secondary shares, with a target for due diligence and a definitive agreement within 45 days, aiming for a mid-February announcement [6] Future Opportunities - If the SPARC merger is successful, Ackman and Musk would influence SpaceX's funding and organizational structure, with SPAR holders potentially gaining access to future offerings from Musk's AI company, xAI [7] - SpaceX is reportedly preparing for a potential IPO that could reach up to $1.5 trillion, significantly surpassing major aerospace competitors, highlighting the opportunity Ackman's proposal seeks to leverage [8]