Elon Musk’s SpaceX Is Courting Two Middle Eastern Investment Powerhouses

SpaceX is in talks with two Middle Eastern investors to raise a round of private funding that would value the Elon Musk-led space company at $140 billion, the Information reported yesterday (March 22).

The two investors are Alpha Dhabi, an investment conglomerate based in Abu Dhabi, and Badeel, an energy holding company owned by Saudi Arabia’s sovereign wealth fund, Public Investment Fund (PIF). PIF has a rocky history with Musk for committing to and then backing out of a deal in 2018 that would have taken Tesla private.

The fundraising is organized by Morgan Stanley, according to the Information.

In January, SpaceX was reported to be raising $750 million in a private round led by Andreessen Horowitz, a venture capital powerhouse. The round would value SpaceX at $137 billion dollars. It’s unclear whether the talks with Alpha Dhabi and Badeel are part of the January round or a new funding effort.

SpaceX didn’t immediately respond to an inquiry to clarify.

SpaceX is backed by Musk and a group of private equity and venture capital firms, including Founders Fund and Sequoia Capital, according to dealroom.co, a startup funding data provider. Musk owns about half of the rocket and satellite company, according to calculations by Barron’s and Forbes.

Last year, SpaceX raised $2 billion at a valuation of $127 billion, making it the most valuable private company in the U.S.

Elon Musk’s history with Saudi sovereign fund

Saudi’s PIF owns stakes in a number of large U.S. tech companies, including Amazon, Google, Microsoft, Uber and Zoom, among many others.

In 2018, Musk said he received unofficial support from PIF to fund a deal to take Tesla private that would cost $70 billion. The deal eventually fell through and Tesla has remained a public company. But Musk’s premature statement about having funding secured to buy out Tesla cost him the position as Tesla’s chairman and multiple regulatory probes.

Text messages between Musk and PIF head Yasir Al-Rumayyan uncovered in a lawsuit showed the Tesla CEO was displeased with how the PIF handling its media statements at the time.