Elon Musk’s rocket and AI company SpaceX pulled off the biggest initial public offering in history last week – and it was even bigger than first thought. The listing on New York’s Nasdaq stock exchange raised $85.7bn (£66bn), $10bn more than the $75bn initially reported, after the banks that backed the IPO exercised a so-called “greenshoe” clause to purchase an additional 83.3 million shares directly from the company to meet exceptional investor demand.
The extra $10bn, revealed in a statement by SpaceX announcing the completion of the listing, would by itself rank as one of the biggest IPOs in history. The underwriters – Goldman Sachs, Bank of America and JPMorgan – used the overallotment option, more commonly referred to as a greenshoe, to prevent wild price swings as investor appetite outstripped the initial supply of shares.
“SpaceX IPO raised $85.7bn, $10bn more than thought, as greenshoe option met huge demand.”
The $75bn raised from investors, Musk told employees, would be spent funding a “significant growth phase”. But the listing also saw Musk elevated to trillionaire status, according to Bloomberg calculations. Because the vast majority of his wealth is tied up in SpaceX equity, his new milestone remains entirely dependent on the market: a sharp decline in the stock could strip him of the title just as quickly as continued gains could multiply it.
Momentum behind SpaceX continued on Monday, with shares surging more than 19% to $192. They were first offered to investors at $135, valuing the company at $1.8tn.
Analysts have warned that SpaceX’s sky-high valuation leaves little room for error, raising questions over whether the loss-making company can sustain its current growth amid growing regulatory scrutiny and rising competition in the commercial space sector.