Wall Street usually sets the price on IPOs. The biggest deals flip that math.
SpaceX is one of those deals, and it's pushing back on what banks want to charge.
What's Happening
SpaceX is in talks with Wall Street banks about a possible IPO. The sticking point: fees.
Banks typically charge 3-7% of the deal size to take a company public, which covers their risk of getting stuck with unsold shares.
For a company SpaceX's size, that math hands a small group of banks billions in payments. SpaceX wants that number down.
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Why SpaceX Has The Leverage
Mega-IPOs have been chipping away at banker fees for over a decade. Facebook paid roughly 1.1% when it went public in 2012, and Alibaba came in close behind at about 1.2% two years later.
Saudi Aramco took it further in 2019, paying about 0.35% on its $25.6 billion debut.
SpaceX, last valued near $800 billion after a private share sale late last year, would dwarf all three.
The bigger the deal, the smaller the cut. SpaceX wants to push that pattern further.
Banks have a reason to play ball. Every major bank on Wall Street wants their name on the SpaceX deal, since landing a spot on the biggest IPO in years pays off in future business.
That hands Elon Musk room to negotiate, especially after taking Tesla public back in 2010.
Worth Noting
SpaceX has not officially confirmed an IPO date, though reporting points to a listing as early as this month. The company has stayed private for over two decades and has plenty of funding options without going public, from private share sales to direct investor rounds.
But the fee fight is the signal. When SpaceX lists, it plans to set the terms.
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