SpaceX Filing Requires Controlling Shareholder Approval for Potential Tesla Deal

SpaceX disclosed that a potential combination with Tesla would need approval from its special committee, board and controlling shareholder, adding a controller approval condition as the companies assess a possible deal.

SpaceX’s Oct. 22 Form 10-Q said its special committee had not reached a determination. The company also said there was no assurance the two companies would reach an agreement or complete a transaction. The committee could decide against recommending a combination.

SpaceX disclosed on Oct. 20 that its board had formed a special committee to assess a potential combination, while Tesla’s board also formed a committee. The Oct. 22 filing added the controlling-shareholder approval condition to the disclosed process.

The approval passage does not name SpaceX’s controlling shareholder. SpaceX’s June prospectus identified SpaceX CEO Elon Musk as the controller after the IPO and projected he would hold 82.3% of voting power if underwriters exercised their option in full. SpaceX’s Form 10-Q confirms the option was exercised in full. The prospectus had projected 82.4% under the base offering terms.

The prospectus used an offering price of $135 per share. It also projected Musk would own a majority of Class B shares after the IPO. Holders of that class can elect 51% of SpaceX’s board, giving them a defined role in board selection.

SpaceX’s approval list treats committee approval, board approval and controller approval as separate requirements. The filing does not report that Musk, the committee or the board has approved a transaction.

Tesla’s Oct. 22 filing describes a review by a special committee of disinterested directors. The committee is considering ways to deepen ties with SpaceX, including a possible business combination. Tesla lists an affirmative committee recommendation and any necessary shareholder approval as conditions for a transaction, but does not separately name controlling-shareholder approval.

The filings describe an evaluation, not an agreed merger, and provide no financial terms for a combination. SpaceX’s committee has not decided whether to recommend a deal; any potential transaction would still need to meet the approval conditions each company disclosed. TokenPost previously examined shareholder dilution in a possible Tesla-SpaceX combination.