SpaceX IPO oversubscribed days before historic Nasdaq debut

SpaceX’s Record $75 Billion IPO Oversubscribed Days Before Nasdaq Debut

SpaceX’s initial public offering has already attracted more orders than shares available, becoming oversubscribed after one-on-one meetings between the company and institutional investors, according to Bloomberg. The development comes just days into the roadshow and a week before the rocket, satellite, and artificial intelligence company is expected to begin trading on the Nasdaq under the ticker SPCX on June 12.bloomberglaw

Fixed Price, Overwhelming Demand

SpaceX is offering 555.6 million shares at a fixed price of $135 each, aiming to raise $75 billion and valuing the company at approximately $1.77 trillion, according to its SEC filing made public on June 3. The company has told underwriting banks it will not adjust the share price despite the surge in demand, an unconventional move that Bloomberg reported reflects CEO Elon Musk’s rejection of the traditional book-building process where bankers set a price range and adjust based on investor appetite.bloomberg

If completed as planned, the offering would be the largest IPO in history, more than doubling the record set by Saudi Aramco in its 2019 listing, which raised $29.4 billion. The IPO is expected to price on the evening of June 11, with trading beginning the following day.cnbc

Roadshow and Retail Access

The company kicked off its investor roadshow on June 4, launching a dedicated IPO website and opening share access to retail investors through Fidelity. SpaceX has reserved up to 30 percent of the offering for retail investors, far above the typical 5 to 10 percent allocation seen in most large listings. Fidelity is making the IPO available to any customer with a retail brokerage account holding $2,000 or more.linkedin

Underwriters, including Morgan Stanley, Bank of America, Citi, JPMorgan, and Goldman Sachs, also have an option to acquire an additional 83 million shares, potentially adding $11.2 billion to the total raise.cnbc

Governance Concerns

Not all investors are enthusiastic. A coalition of institutional investors led by the New York City Comptroller and CalPERS raised concerns about SpaceX’s governance structure, which would give Musk over 82 percent of voting control through super-voting Class B shares while holding roughly 42 percent of the economic interest. Morningstar analyst Nicholas Owens has estimated the company’s fair value at $780 billion, about 55 percent below the IPO valuation.fortune