SpaceX and Saudi PIF in $5B Talks as SpaceX Targets Largest IPO in History
SpaceX is in discussions with Saudi Arabia’s Public Investment Fund about a $5 billion anchor investment ahead of what could be the largest initial public offering ever seen on US markets.
The talks, first reported by Reuters on April 2, would see PIF take an anchor stake to preserve its existing position of just under 1% in SpaceX. The investment would come as part of a listing that confidentially filed its draft S-1 registration with the SEC on April 1, targeting a valuation between $1.75 and $2 trillion.
If SpaceX hits that target, it will raise up to $75 billion — obliterating the current record held by Saudi Aramco’s $29.4 billion IPO in 2019. This wouldn’t just be a big listing. It would be the largest IPO in the history of public markets.
Project Apex
The IPO is being run under the code name “Project Apex” — and the banking syndicate assembled for it reads like a who’s who of global finance.
Twenty-one banks have been lined up. Morgan Stanley, Goldman Sachs, JPMorgan Chase, Bank of America, and Citigroup are lead bookrunners. The broader syndicate includes Barclays, Deutsche Bank, UBS, Societe Generale, Santander, Mizuho, and Macquarie, among others.
Public S-1 filing is expected late April or May, with a Nasdaq listing targeted for June 2026. The structure will almost certainly include dual-class shares, preserving Elon Musk’s approximately 79% voting rights through the private structure.
The valuation trajectory tells its own story. SpaceX was worth $350 billion in a December 2024 secondary share sale. The February 2026 merger with xAI valued the combined entity at $1.25 trillion. The IPO target of $1.75 to $2 trillion represents another $500 billion jump in roughly six weeks.
💡 $75 billion — the amount SpaceX could raise in its IPO. That’s 2.5x the current record held by Saudi Aramco. It would be larger than the total raised by all US IPOs combined in several recent years.
The Saudi Connection
The PIF talks are the latest chapter in an increasingly deep relationship between Saudi Arabia and Musk’s technology empire.
PIF controls over $900 billion in assets and is central to Crown Prince Mohammed bin Salman’s Vision 2030 economic diversification strategy. The fund has already invested heavily in Musk ventures: HUMAIN, PIF’s central AI vehicle, invested $3 billion in xAI — a stake that converted to SpaceX shares after the xAI-SpaceX merger. HUMAIN also partnered with xAI to deploy 500 megawatts of data center capacity in Saudi Arabia and struck a deal with NVIDIA to deploy 600,000 chips across Saudi Arabia and the US over three years.
On the space side, PIF launched Neo Space Group in May 2024 — a dedicated space company focusing on satellite communications, earth observation, navigation, and IoT. NSG acquired Airbus’s UP42 geospatial platform in December 2024 and controls Saudi Arabia’s commercial satellite activities.
The SpaceX investment would extend this strategy directly into the US launch and satellite infrastructure market. For PIF, it’s a diversification play. For SpaceX, it’s a signal to other sovereign wealth funds and institutional investors that the world’s largest pools of capital see value at a $2 trillion valuation.
This is the same pattern we’ve seen in other sectors — sovereign capital flowing into critical tech infrastructure ahead of public market listings.
The Money: What SpaceX Actually Earns
The valuation is extraordinary. The financials are solid, but are they $2 trillion solid?
- 2025 Revenue: $15-16 billion
- EBITDA: ~$7.5-8 billion
- Starlink Revenue: ~$10 billion (9.2 million subscribers across 150 countries)
- Launch Revenue: ~$5-6 billion (122 successful launches in 2025)
- Government/Defense: $24.4 billion cumulative since 2008
- Free Cash Flow: ~$2 billion
Starlink is the engine. Subscriber count doubled from 4.6 million at end-2024 to 9.2 million in 2025. Projected 2026: 16-17 million subscribers, roughly $24 billion in revenue. NASA accounts for only about 5% of SpaceX revenue — this is a commercial broadband company that happens to launch rockets.
But here’s the valuation math that should give investors pause: at $1.75 trillion, SpaceX would trade at approximately 87 times revenue and 220 times EBITDA. At $2 trillion, that’s 130 times revenue and 250 times EBITDA. For context, Palantir trades at about 79 times price-to-sales — the highest in the S&P 500 — but Palantir is growing at 70%, roughly 3.5x SpaceX’s ~20% growth rate.
The valuation is essentially a bet on three things: Starlink’s subscriber trajectory continuing to double, Starship achieving operational scale, and orbital AI data centers becoming viable. None of these are proven at scale yet.
The xAI Problem
There’s a drag on these numbers that doesn’t get enough attention: xAI is losing approximately $1 billion per month.
The February 2026 merger folded Musk’s artificial intelligence company into SpaceX’s structure, combining a profitable launch and satellite business with a cash-burning AI lab. On a consolidated basis, xAI’s losses significantly impact the combined entity’s financial profile.
The X platform (formerly Twitter) adds another complication — roughly $2.9 billion in revenue, reportedly near break-even, but operating in a challenging advertising market. Musk reportedly mandated that participating banks in the IPO purchase Grok AI subscriptions — millions annually — as a condition of involvement in the deal.
Investors buying into the IPO are taking on the xAI burn rate whether they like it or not. The question is whether Starlink’s growth can outrun xAI’s spending.
The Political Question
The political backdrop is unusually favorable for Saudi investment in US tech. Trump has approved US AI chip shipments to Saudi Arabia for HUMAIN data centers. Saudi Arabia has pledged $1 trillion in planned US investments over the coming decade. Musk maintains close ties with the Trump administration through his DOGE role.
But SpaceX isn’t a normal company. It holds sensitive government and defense contracts worth $24.4 billion since 2008 — NASA, Space Force, Air Force. Senators Elizabeth Warren and Andy Kim wrote to Defense Secretary Hegseth in February 2026 raising concerns about foreign investment in SpaceX and calling for CFIUS review.
Saudi Arabia is generally treated as a friendly nation for CFIUS purposes, unlike China. A CFIUS review is less likely to block PIF than it would Chinese investors. And the dual-class structure means Musk retains control regardless of foreign investment levels. But the sensitivity of SpaceX’s technology — reusable rockets, satellite internet, potential military applications — means every foreign investment draws scrutiny.
The regulatory environment is permissive now. Whether it stays that way is a different question.
What This Means for the IPO Market
SpaceX’s listing is being positioned as a make-or-break test for mega-IPOs. If it works, it could unlock a wave of large-cap tech listings that have been waiting on the sidelines. If it stumbles at $2 trillion, the whole pipeline freezes.
The comparison list is sobering:
- SpaceX (target): $75 billion raised, 2026
- Saudi Aramco: $29.4 billion, 2019
- Alibaba: $22 billion, 2014
- Visa: $18 billion, 2008
- ARM Holdings: $4.9 billion, 2023
SpaceX’s target is 2.5x the current record. It’s not just testing investor appetite — it’s redefining what’s possible in public markets.
The bear case is straightforward: at 130x revenue, you’re paying for a future that hasn’t been built yet. Orbital data centers face the same engineering challenges that sank Microsoft’s undersea project. Starship hasn’t achieved regular orbital operations. Starlink’s growth could plateau as it saturates easy markets and faces competition from Amazon’s Kuiper and other LEO constellations.
The bull case is equally clear: there is no other company that lands rockets, operates the world’s largest satellite constellation, and has a credible path to Mars. The scarcity value alone drives premium pricing. And if Starship achieves full reusability, the cost curve drops by an order of magnitude.
The Sovereign Capital Playbook
The PIF anchor investment signals something broader than one fund buying one IPO. It signals that sovereign wealth funds are now the anchor investors in the most important technology companies on Earth.
Saudi Arabia invested $3 billion in xAI. It’s now positioning for $5 billion in SpaceX. It launched Neo Space Group to build domestic space capability. It partnered with NVIDIA for 600,000 chips. This isn’t passive investment — it’s strategic positioning in the infrastructure layers that will define the next decade.
The pattern repeats across sovereign funds: UAE’s MGX, Singapore’s Temasek, Abu Dhabi’s ADQ — all aggressively positioning in AI, space, and semiconductor infrastructure. The broader trend of sovereign capital flowing into technology infrastructure is accelerating.
For US policymakers, this creates a tension they haven’t resolved. On one hand, these investments fund American innovation and create jobs. On the other hand, they give foreign governments ownership stakes in companies that build rockets for the US military.
The $2 trillion question isn’t just whether SpaceX is worth it. It’s whether the US is comfortable with who’s buying in.
What Happens Next
Public S-1 filing expected late April or May. Nasdaq listing targeted for June 2026. PIF’s anchor investment — if it materialises — will be finalised before the roadshow.
The banks are committed. The political environment is favorable. The demand appears to be there. The only question left is price.
At $1.75 trillion, SpaceX is expensive but potentially defensible. At $2 trillion, you’re buying faith — faith in Starlink, faith in Starship, faith in Musk. The market has been willing to pay that premium before. Whether it will pay it at this scale, with xAI bleeding cash and orbital data centers still on paper, is the most important test public markets will face in 2026.
The largest IPO in history. The richest sovereign fund in the world. The most ambitious entrepreneur of his generation. Three things that all need each other to work.
We’re about to find out if they do.
Related Reading
- IMF Weighs In: The 2026 Roadmap for Real-World Asset Tokenization — Sovereign capital flowing into infrastructure layers
- The UK Just Told Microsoft Its AI Strategy Needs Regulatory Supervision — How governments are wrestling with tech company power
- UK FCA Crypto Licensing Regime — Another example of regulatory frameworks catching up to tech scale
Sources
- Reuters — SpaceX holds talks with Saudi PIF for $5B investment
- Reuters — SpaceX targets $2T+ valuation
- Reuters — SpaceX seen as make-or-break test for mega IPOs
- CNBC — SpaceX lines up 21 banks, Project Apex
- CNBC — SpaceX confidentially files for IPO
- CBS News — SpaceX IPO, largest ever
- Quartz — SpaceX files IPO targeting trillion valuation
- PIF — Aerospace and defense strategy
- PIF — Neo Space Group launch
- CNBC — xAI Saudi data center
- MIT Sloan ME — HUMAIN $3B xAI investment
- Motley Fool — SpaceX IPO: buy or bust
- Sacra — SpaceX equity research
- Sacra — Revenue analysis
- Warren/Kim — CFIUS letter on SpaceX foreign investment
- Benzinga — Musk leverages IPO for Grok subscriptions
- Bloomberg — US tech layoffs rise with AI adoption
- SpaceNews — Starlink $11.8B revenue
- Ars Technica — Starlink profit growing
- BusinessToday — Mega IPOs comparison
