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- SpaceX and Tesla have each established exploratory committees to discuss a possible merger, Elon Musk said.
- Musk, who said he can't participate in the talks, gave the update during Tesla's Q3 earnings call.
- Musk said he thinks a merger is a good idea, but cautioned investors that shareholder approval is "quite a high hurdle."
Houston, we have an update on all that SpaceX-Tesla merger chatter.
During SpaceX's Tuesday earnings call, Elon Musk said both of the companies had created "special committees of independent directors" to discuss a potential merger.
Musk, who helms both companies and owns billions of dollars in stock of each, said he can't be part of those exploratory groups.
"Do I think it would be a good idea? Yes," he said on the call. "But at the end of the day, the shareholders have to be supportive of this, and particularly on the Tesla side, we will need a 50% vote of all shares, not just those who vote, but of all shareholders."
He said clearing that bar would be "quite a high hurdle."
It's the most detailed update investors have received yet on the idea of a tie-up, which has been the subject of much chatter since SpaceX went public earlier this year. If the companies ultimately decide to merge, it would further consolidate Musk's business empire, often referred to as Musk Inc.
Both company stocks were up in after hours trading following the news. SpaceX was up around 6.6% and Tesla 1.6%.
Musk sees clear benefits in tying the knot
"I do think there's a lot of merit to combining the companies as we are pretty much in the superintelligence singularity," Musk said during the call.
Both companies have worked together on a host of projects, including artificial intelligence software, chip design, TeraFab manufacturing efforts, robotics, Starlink satellite connectivity, and SpaceX's ability to launch payloads into orbit, Musk and SpaceX president Gwynne Shotwell said.
The most recent result of that partnership: On Thursday, Tesla demoed its long-awaited Roadster, which includes a version with SpaceX technology. The high-powered sports car's top trim will include cold-gas thrusters. The car launched, hovered, and flipped in the air during the demo.
While Musk is for the two companies tying the knot, he cautioned investors that they shouldn't assume it's guaranteed.
"I don't think we should necessarily assume that a SpaceX and Tesla merger is a certainty," he added. "That would be overstating it."