The Zhitong Finance App learned that Lumasenti's managing partner Larry Goldberg said that Tesla (TSLA.US) shareholders can benefit from the merger with SpaceX (SPCX.US) without a premium, and proposed $500 per share as a figure that may persuade investors to support the deal. Tesla rose 4% to close at $407.46 on Tuesday; SpaceX rose 1% to $148.58.
Goldberg: $500 compromise or facilitation of merger
“I don't see any reason to pay a premium. But if it's a price that makes these very angry shareholders happy, then pay.”
Goldberg said in an interview with Tesla opinion leader Herbertong. When asked what would win investor support, he said, “I think the number that will give you relief is $500.” Goldberg's priority was to complete the merger rather than stick to a specific price. “Once again, it makes no difference to me. I just want it done,” he said.
Goldberg said investors should also consider the value of shares they will receive as well as the price corresponding to Tesla's holdings. “The lower the premium, the higher the value of SpaceX shares you get in exchange,” he said.
“So you're paying too much attention to Tesla's share price without considering the SpaceX shares you'll get and their future, because that's your future.” His argument was based in part on timing. He believes SpaceX's opportunity is closer, while Tesla's long-term potential is more uncertain.
“So while Tesla may be worth more than SpaceX over time, the opportunity for SpaceX is today. So why not combine today's values with tomorrow's values?” he said. Goldberg also said that merging the assets and cash flow of the two companies could help finance the expansion of the computing infrastructure, which he estimated would be needed between $500 billion and $1 trillion depending on size.
Goldberg refutes Tesla shareholders
Goldberg said his position was fiercely opposed by Tesla investors, who are concerned about the current value of its shares and expectations of higher prices in the future. “My point is that merging these companies is in everyone's interest and gives fair value. But they can't see that, so they will vote against it,” he said.
Goldberg believes retail investors are ignoring the long-term value of the deal. He also denied claims that his position reflected more SpaceX shares. “Everyone says I own SpaceX better than Slado. “Well, they don't know, they're wrong,” he said, but did not detail the position. “But in my opinion, the sooner this happens, the better.”
Prices approved by TSLA and SPCX shareholders
Other investors see a reason to pay the higher price. AltimeterCapital founder Bradgerstner suggested Tesla's valuation in the $420 to $550 range, adding that a premium of more than 30% could help its special committee resist potential lawsuits.
Additionally, ARK's latest model predicts that no premium share swaps will benefit both shareholder groups. Equalizing the extra upside means a 24% premium over Tesla's closing price on October 23. Tesla's quarterly documents confirm that a special committee is exploring a deeper relationship with SpaceX, possibly including a business merger.
Musk said the two companies' independent committees have yet to agree on the terms, and he was excluded from discussions due to a conflict of interest. He also said that Tesla needs approval for 50% of all shares.
On Stocktwits, retail sentiment in TSLA and SPCX was “bearish,” TSLA's message volume was “high,” and SPCX was “normal.” One user said, “$SPCX declined after merging valuations with TSLA. Tesla will benefit and SPCX will be diluted.” Another user said, “I think if the $TSLA merger happens, the low end is 500 and the high end is 600. Just my thoughts. Breaking through 420 is the key, and 460 may be the next resistance level.” TSLA's stock price has fallen 9% so far this year, and SPCX has fallen 8% over the same period.