SpaceX has completed its acquisition of xAI using a so-called “triangular merger” structure, creating a technology empire valued at around $1.25 trillion. Under this arrangement, xAI becomes a wholly owned subsidiary of SpaceX while remaining legally and financially separate, helping shield SpaceX from potential legal risks linked to the X platform and its Grok chatbot.

From a financial perspective, the deal is structured as a tax-free reorganization, allowing xAI shareholders to defer taxes when exchanging their shares for SpaceX stock. At the same time, SpaceX avoids triggering “change-of-control” clauses tied to roughly $17 billion in xAI debt, sparing the company from costly immediate repayments amid high interest rates.

The structure also helps SpaceX maintain a clean balance sheet ahead of its highly anticipated IPO, expected in late June, which could raise more than $50 billion and value the company at over $1.5 trillion post-listing. Analysts see the acquisition as a strategic move to build a vertically integrated ecosystem combining rockets, Starlink, AI and data from X—reinforcing Elon Musk’s reputation not only as a visionary engineer, but also as a shrewd financial strategist.