Morgan Stanley is positioned as a strong candidate for a significant role in SpaceX’s upcoming initial public offering (IPO), bolstered by its long-standing relationship with CEO Elon Musk. A competitive selection process, described as a “bake-off,” is underway involving several banks including Morgan Stanley, Goldman Sachs, and JPMorgan. However, there is still no guarantee that Morgan Stanley will obtain the key “lead left” underwriting role, although it is perceived as the frontrunner due to its deep ties with Musk, which span over 15 years.
The ongoing discussions regarding the IPO are confidential, as the sources have requested anonymity. None of the banks involved, including Morgan Stanley, Goldman Sachs, and JPMorgan, have provided comments on the situation, and SpaceX has not responded to inquiries. While Musk has yet to finalize his choice of lead banks, decisions may be made before year-end, following which the complete syndicate of underwriters will likely be established. The IPO, however, remains dependent on market conditions, with the possibility of a delay or cancellation.
Historically, Morgan Stanley has been closely allied with Musk, having advised during Tesla’s IPO in 2010, where it served alongside Goldman Sachs and others. Morgan Stanley later facilitated Musk’s financing for his acquisition of Twitter, and Musk has recently appointed Anthony Armstrong, a banker at Morgan Stanley, as chief financial officer of his AI firm, xAI. Additionally, the connection extends to Musk’s family office, Excession, operated by former Morgan Stanley banker Jared Birchall.
In a recent memo, SpaceX CFO Bret Johnsen communicated to employees that preparations are underway for a public offering, potentially in 2026. He noted that while many uncertainties surround the offering—including its timing and valuation—a successful execution could yield substantial capital. Reports suggest that SpaceX aims to raise over $25 billion in this IPO, which could be among the largest in history. The decision to transition to a public offering has sparked surprise due to SpaceX’s previous stance on remaining private. However, it appears that increasing company valuation and the success of its Starlink satellite internet service have influenced this shift.
SpaceX has evolved beyond its initial launch services, becoming the largest satellite operator with its Starlink network. While speculation about Starlink going public independently circulated, the prevailing view is that the IPO may encompass both the rocket and satellite businesses, with plans still subject to adjustment.
Johnsen indicated that the IPO proceeds would enhance the flight rate of SpaceX’s Starship, a crucial development project, as well as fund AI data centers in space. Furthermore, the company plans to establish “Moonbase Alpha” as part of its contributions to NASA’s Artemis moon mission. Musk’s long-term aspirations for Mars exploration are also supported by revenues generated from Starlink, which is additionally venturing into the wireless market with its new Starlink Mobile initiative.
With information from Reuters