How Would a Tesla and SpaceX Merger Work?

Ed Elson says a Tesla and SpaceX merger would probably mean SpaceX buys Tesla and pays Tesla investors in SpaceX stock. Shareholders would convert Tesla shares into SpaceX shares at a price the boards set. RBC predicts a 20 to 30 percent premium.

He says that premium can disappear. The payment is SpaceX stock, so a holder can look 20 percent richer and then lose the premium if SpaceX falls 20 percent the next day. Ed Elson says that could easily happen because the float is still about 15 to 20 percent, while NVIDIA and Microsoft, which he calls actual multi-trillion-dollar companies, have floats near 100 percent. A smaller float, he says, is easier for very large shareholders to move. He calls a Raymond James target of $10 trillion for SpaceX today ridiculous, says the price is extremely inflated and being manipulated, and says Elon Musk can treat a $2 trillion SpaceX value, which Ed Elson calls a bullshit number, as the currency used to buy Tesla.