By Iyore Akezua
Elon Musk’s aerospace company, SpaceX, has acquired his artificial intelligence firm, xAI, in a landmark merger designed to accelerate the deployment of space-based data centres and advanced AI systems.
The deal, announced on Monday in a statement published on SpaceX’s website and signed by Musk, brings together SpaceX’s rocket and satellite capabilities with xAI’s artificial intelligence technology. Musk described the union as the creation of “the most ambitious, vertically integrated innovation engine on — and off — Earth.”
According to Bloomberg News, the merged entity is expected to price its shares at approximately US$527 each, giving the combined company a staggering valuation of about US$1.25 trillion.
The merger represents one of Silicon Valley’s most high-value corporate combinations, blending a dominant space-and-defence contractor with a fast-growing AI company whose major expenses include advanced chips, massive data centres and energy infrastructure.
Industry sources say the move aligns with Musk’s broader vision of unifying his technology empire. Prior to the announcement, SpaceX and xAI had reportedly been in talks to merge ahead of a potential blockbuster public offering planned for later this year. The integration is expected to bring Musk’s rockets, Starlink satellite network, the X social media platform and the Grok AI chatbot under a single corporate structure.
As part of the long-term strategy, SpaceX is seeking regulatory approval to deploy up to one million satellites into Earth’s orbit, according to a recent filing. These satellites would play a key role in supporting space-based computing and AI data processing.
Unlike some of Musk’s other ventures, SpaceX has consistently stood out as his most successful enterprise. It remains the only US company capable of routinely transporting astronauts to and from the International Space Station and is a major launch provider for both NASA and the US Department of Defence.
Even more significant is the growing revenue from SpaceX’s Starlink network, which now comprises more than 9,000 satellites. Income from Starlink has reportedly surpassed launch revenues, positioning it as a critical funding source for xAI’s capital-intensive ambitions.
The merger signals a bold step toward integrating space technology and artificial intelligence at an unprecedented scale, potentially reshaping both industries in the years ahead.
