Elon Musk is moving to unite SpaceX and artificial intelligence startup xAI in a sweeping merger that would fuse his ambitions in space and AI under one corporate roof, Bloomberg reports.

The deal, outlined in an internal memo, would value the combined company at roughly $1.25 trillion, with shares expected to be priced near $527, according to sources familiar with the deal.

The transaction has not been publicly announced, and the people requested anonymity due to its confidential nature.

Neither SpaceX nor xAI responded to requests for comment.

The merger would pair two of the world’s most valuable privately held companies as SpaceX prepares for a potential initial public offering that could raise up to $50 billion.

xAI, which develops the Grok chatbot, was valued at $230 billion in a recent funding round, while SpaceX was recently valued at about $800 billion.

Bringing the companies together would deepen the ties across Musk’s expanding business empire, which already includes Tesla and the social media platform X.

xAI has been burning through roughly $1 billion per month, making access to SpaceX’s capital, infrastructure, and computing power especially attractive.

The merger could also accelerate Musk’s long-term vision of moving data centers into orbit.

SpaceX has sought regulatory approval to deploy up to one million satellites, potentially enabling advanced AI computing from space.

If completed, the deal would mark one of the most ambitious corporate consolidations in tech history — and set the stage for one of the largest IPOs ever.