SpaceX shares hit a record price during the tender offer process
Shares in SpaceX hit a record high during the tender offer process. The space company decided on this procedure to assess the company’s value.
The tender offer allows the company’s employees and investors to sell their shares above the standard price. The value per share is now USD 112, which puts the company’s valuation at USD 210 billion. That is the maximum value of any private company in the US, not just SpaceX. Previously, the startup’s value was USD 200 billion.
Despite the high valuation, SpaceX lags behind the Chinese company ByteDance, whose capitalisation was USD 268 billion. The latter is the parent company of the social network TikTok.
SpaceX’s investment growth and share buyback strategy
Investor interest in SpaceX was the reason for the offer. By the end of 2023, the company’s shares were worth USD 97 each and its total capitalisation reached USD 180 billion. SpaceX also held a funding round in early 2023, raising USD 750 million. In this round, venture capital firm Andreessen Horowitz was a significant investor, investing USD 137 million.
The company’s founder, Elon Musk, has not commented on the current offering. However, in June 2024, he wrote on social network X that the company did not need to raise additional capital. He also announced plans to buy back shares. A little later, Musk wrote that liquidity rounds were standard practice for the startup. This happens every six months for employees and current investors.
Risks to the business value
Analysts believe problems with the Falcon 9 rocket could affect SpaceX’s share price. We are talking about the first failed launch in July 2024:
1. The vehicle’s second stage was unable to complete the manoeuvre.
2. This led to 20 Starlink satellites spinning around in orbit and burning up.
3. The cause of the failure was an engine malfunction. The company did not say exactly what the malfunction was, but according to one version, it was due to a fuel leak.
So far, all launches of this type of rocket have been postponed. The FAA has also banned flights by SpaceX vehicles, which is pending a full investigation. NASA has also joined the investigation. Its specialists are accompanying all the launch missions to provide additional technical support.
It is worth noting that this was the launch company’s first accident. Previously, the company had carried out 300 successful launches, making it a leader in the sector.
Experts believe that the failure could slow down the company’s development. As a result, investor interest will also decline. Beyond the pessimistic scenario, however, analysts also see a quick recovery for the company.
