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Musk's SpaceX in merger talks with xAI ahead of planned IPO: Reuters

The merger aims to unify SpaceX's space assets with xAI's AI technologies, potentially creating space-based data centers and strengthening Musk's position in AI and space sectors.

  • On January 29, 2026, Reuters reported SpaceX and xAI are in discussions to merge ahead of a planned SpaceX IPO later this year, folding Musk's rockets, Starlink, X platform, and Grok chatbot into one company.
  • Musk's consolidation strategy has driven discussions to merge SpaceX and xAI, advancing space-based data centers to cut AI computing costs and compete with Google, Meta and OpenAI.
  • Corporate records list K2 Merger Sub Inc. and K2 Merger Sub 2 LLC, formed January 21, with SpaceX and Bret Johnsen, SpaceX chief financial officer, as managing members or officers.
  • No final agreement has been signed and the timing remains fluid while company representatives have not commented as SpaceX lines up banks for an IPO this year with valuations reported above $1 trillion.
  • U.S. national-security ties are highlighted by U.S. Defense Secretary Pete Hegseth's visit to SpaceX's Starbase earlier this month and xAI's $200 million Pentagon contract, raising scrutiny.
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Forbes broke the news in United States on Thursday, January 29, 2026.
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