Leaders from three of the largest U.S. public pension systems have voiced serious concerns over SpaceX’s proposed “extreme” ownership and control structure ahead of its anticipated public stock listing. New York State Comptroller Thomas DiNapoli, New York City Comptroller Mark Levine, and California Public Employees’ Retirement System CEO Marcie Frost sent a letter to founder and CEO Elon Musk, urging the removal of provisions that could curb shareholder protections. SpaceX is a private American aerospace manufacturer and space transport services company, also known for its Starlink satellite internet constellation. The company’s expected initial public offering (IPO) is projected to be the largest in history, aiming to raise $75 billion with a valuation of $1.75 trillion.
Representing over $1 trillion in retirement assets, the pension officials specifically objected to the extensive power granted to Mr. Musk. This includes his voting control over the stock, veto power over his own removal as CEO, and protections from litigation, such as mandatory arbitration for shareholder claims. They described the planned IPO as potentially “the most management-favorable governance structure ever brought to the U.S. public markets at this scale.” Further concerns were raised about the company’s reincorporation in Texas, where new laws could effectively block derivative litigation by requiring billions of dollars in shareholdings – a threshold likely only Mr. Musk could meet.
The pension leaders also flagged Mr. Musk’s sprawling corporate empire, noting his simultaneous leadership of Tesla, X, xAI, The Boring Company, and Neuralink. They contend this puts companies like SpaceX and Tesla in direct competition for his time and attention. The letter highlighted governance red flags beyond dual-class shares, including provisions allowing Mr. Musk to be removed as CEO or chair only by a vote of Class B shareholders, votes he controls. Concerns about related-party transactions, such as SpaceX’s reported acquisition of xAI and Tesla’s investment in SpaceX, were also raised. The officials have requested a meeting with Mr. Musk to address these issues, advocating for one-share, one-vote, a majority-independent board, and separate CEO and chair roles.
