There is a deep connection with Tesla (TSLA.US) CEO Musk, and it is rumored that Damo is expected to lead SpaceX's epic IPO

The Zhitong Finance App learned that, according to people familiar with the matter, Morgan Stanley (MS.US) is becoming one of the most competitive investment banks in SpaceX's potential initial public offering (IPO). Since it has maintained a close cooperative relationship with SpaceX CEO and Tesla (TSLA.US) CEO Musk for a long time, Morgan Stanley is considered to have a clear advantage in related selections.

Currently, SpaceX's IPO underwriting arrangement has not been finalized, and several investment banks are competing for underwriting rights. According to several people familiar with the matter, a few large investment banks, including Goldman Sachs (GS.US) and J.P. Morgan Chase (JPM.US), are competing for key underwriting roles. However, sources also stressed that it is uncertain whether Morgan Stanley can eventually obtain the most central “lead underwriter” position, and related discussions are still ongoing.

People familiar with the matter pointed out that the relationship between Musk and Morgan Stanley dates back at least 15 years, making the bank widely regarded as one of the popular candidates to lead underwriters, but no investment banks have yet been officially finalized, and there are still variables in the final arrangement. The parties concerned all requested anonymity as the discussion was still confidential. Morgan Stanley, Goldman Sachs, and J.P. Morgan Chase declined to comment, and SpaceX did not respond to requests for comment.

As one of the largest unlisted companies in the world, if SpaceX promotes an IPO, its transaction structure will be extremely complicated. Although Musk has yet to select a lead bank, some sources say the relevant decisions may be made before the end of this year, and the full list of underwriters may be finalized later. However, the IPO plan still depends on the market environment, and SpaceX does not rule out the possibility of delaying or even abandoning the listing.

Morgan Stanley has a long history of collaboration with Musk. The bank participated in Tesla's IPO in 2010 and provided advisory services and led financing for Musk's acquisition of Twitter (now renamed X) in 2022. Recently, Musk also appointed banker Anthony Armstrong as the chief financial officer of his artificial intelligence company XAI from Morgan Stanley's team serving the transaction.

That connection also extended to Musk's family office in Austin, Texas. Jared Birchall, a former Morgan Stanley banker who advised Musk on Wall Street matters for a long time, founded and managed Exception, which is responsible for managing Musk's personal assets.

In an internal memo sent to employees last week, SpaceX chief financial officer Bret Johnsen said the company is preparing for a public listing in 2026. He wrote in the email that there is still a high degree of uncertainty about whether to go public, when it will go public, and the valuation level, but if the company is properly executed and market conditions match, the IPO can be expected to raise a large amount of capital for the company.

Earlier, it was reported that SpaceX plans to raise more than 25 billion US dollars through the IPO. If successful, it will become one of the largest listing deals in the world. Considering that SpaceX has been privatized for a long time, this listing plan came as a surprise to some market participants. People familiar with the matter said that as the company's valuation continues to rise and the Starlink (Starlink) satellite internet business develops rapidly, Musk's attitude towards listing has changed.

Originally famous for its rocket launch business, SpaceX has now become the world's largest satellite operator with Starlink, operating nearly 10,000 satellites and providing broadband services to individual users, government, and corporate customers. Although the market previously speculated that Starlink might be listed separately, relevant sources said that the current IPO may cover the two major businesses of rocket and satellite internet, and the specific plan may still be adjusted.

Johnson stated in an internal email that the capital raised by the IPO will be used to increase the launch frequency of the next generation “Starship” (Starship) rocket and deploy AI data centers in space to more deeply integrate into the global AI investment boom. In addition, the funds will also support the construction of the “Lunar Base Alpha,” which Musk has mentioned many times. SpaceX is currently one of the core contractors for NASA's Artemis lunar landing program, with a contract value of around $4 billion.

Sending humans and robots to Mars has always been Musk's long-term vision for SpaceX, and the continuous cash flow brought by Starlink is providing important support for the development of the “Starship” Mars transportation system. Currently, Starlink is still SpaceX's main source of revenue, and the company is also speeding up its expansion into the wireless communications field and promoting new business layouts such as “Starlink Mobile.”