Why I believe Elon Musk and SpaceX owe Tesla shareholders a substantial acquisition premium. 1/2 - Most people agree that Tesla shareholders will demand a hefty premium to approve a SpaceX acquisition, and rightly so. But with SpaceX’s revenue and profits accelerating at an incredible pace, driven largely by the insane demand for AI compute and their extraordinary ability to build massive data centers faster and cheaper than most competitors, I can see some Tesla shareholders becoming willing to accept a much smaller premium just to participate in that growth. IMO, that would be a mistake. And here is why. I’m not even going to bring up the promises made over the years about taking care of Tesla’s long-term investors. I’ve learned not to base strong convictions on promises. Actions matter a lot more, and there are three important things Tesla shareholders shouldn’t forget: 1. Tesla helped build the talent that helped create xAI. Elon founded xAI, and some very talented AI engineers who had worked at Tesla ended up joining his new company. I know Elon explained that those engineers were being aggressively recruited elsewhere and would probably have left anyway. Fine, I can accept that explanation. But it doesn’t change the fact that Tesla invested years and substantial resources developing talent that ultimately helped build another company controlled by Elon. Tesla shareholders helped finance that development, yet the economic benefits of xAI’s success ended up largely outside Tesla. 2. The Nvidia GPU diversion. Back in 2024, roughly 12,000 Nvidia H100 GPUs originally allocated to Tesla were redirected to xAI, delaying Tesla’s access to those chips and remember, this happened when advanced AI GPUs were extremely difficult to obtain. Elon explained that Tesla’s data center wasn’t ready and those GPUs would have been sitting in a warehouse. Again, that’s a reasonable explanation. But let’s not pretend xAI wasn’t an enormous priority for Elon. He was racing against time to compete with OpenAI, Google and other AI leaders, and getting those GPUs sooner was a significant advantage. Whether the decision was justified or not, Tesla’s position in the allocation queue was used to accelerate Elon’s new AI business. 3. SpaceX got xAI, not Tesla. When Elon decided to combine xAI with SpaceX, he effectively placed one of the fastest-growing AI businesses inside the company where he had substantially more ownership and control. From Elon’s perspective, I understand why that made sense, but from Tesla shareholders’ perspective? Not nearly as much. Tesla had spent years positioning itself as an AI and robotics company, yet the enormous potential value of xAI ended up benefiting SpaceX shareholders directly, not Tesla shareholders. We were left holding the short end of the stick. And now, with SpaceX reporting extraordinary growth in AI compute revenue, the financial consequences of that decision are becoming increasingly obvious. These three points matter when negotiating a Tesla acquisition. I’m sure SpaceX shareholders couldn’t care less about any of this. They want the best possible deal for their company, and I don’t blame them. But Elon has far greater ownership and voting control at SpaceX, and I believe he has a responsibility to make sure Tesla shareholders are treated fairly. Many of us have supported Tesla for years, through extraordinary volatility, repeated delays, missed expectations and enormous opportunity costs. Those who invested around five years ago have seen relatively modest returns compared with what they could have earned elsewhere, while remaining committed to Elon’s vision and supporting him unconditionally. I’m one of those investors, and I still believe enormously in Tesla’s future.But supporting Elon doesn’t mean giving SpaceX a discount at Tesla shareholders’ expense. $TSLA $SPCX #Tesla #SpaceX #ElonMusk #xAI #TeslaShareholders #Merger #AI