Source: Fortune
Summary
SpaceX’s recent IPO has raised $86 billion, with only 4-5% of its stock sold. The remaining 95% is locked up in a complex schedule, with 15 dates for sales in the public markets. The lock-up period is designed to prevent a glut of stock from flooding the market and putting downward pressure on the stock price. Elon Musk, who holds 82% of the voting power, is locked up for 366 days, with no early-release provisions. Investors are watching to see how the stock will perform when the lock-up period ends.
Our Reading
The numbers tell one story.
SpaceX’s lock-up schedule is one of the most complicated in history, with 15 dates for sales in the public markets. The company is trying to prevent a glut of stock from flooding the market, but the risk of a supernova event when Musk’s lock-up period ends is high. Musk’s track record with Tesla stock suggests he may not sell any SpaceX stock at all. The company’s stock has surged since its IPO, but its future performance is uncertain.
As one expert noted, “It’s outside the bounds of anything we’ve seen before.”
Author: Evan Null
