SpaceX IPO hits $85.7B after 'greenshoe' overallotment is exercised

SpaceX has raised its total initial public offering proceeds to $85.7 billion after underwriters exercised the “greenshoe” overallotment option, extending the scale of what is now the largest IPO on record.

The additional shares were taken up by a syndicate of banks led by Goldman Sachs and Morgan Stanley, which had the option to purchase up to 83.3 million extra shares as part of the offering structure.

The move brings the total capital raised in the IPO to $85.7 billion, following an initial $75 billion offering earlier in the week.

Greenshoe Option Pushes IPO Beyond Record Levels

The so-called greenshoe mechanism—formally known as an overallotment option—is commonly used in large listings to stabilise pricing and support demand. It allows underwriters to purchase additional shares if the stock performs strongly after debut.

In this case, the option was exercised after SpaceX shares surged in their market debut, reflecting strong investor appetite for the company’s stock.

The scale of the overallotment has made the transaction larger than almost all previous technology IPOs on record.

Strong Market Debut Drives Continued Gains

SpaceX set its IPO price at $135 per share. The stock rose sharply on its first day of trading, closing near $161 after a 19% gain.

On Monday, shares continued to climb, rising more than 6% in early trading as the stock extended its post-listing momentum.

The company’s market capitalisation has now moved beyond $2 trillion, placing it among the most highly valued public companies globally.

Musk Cites Expansion Into AI and Space Infrastructure

Elon Musk told employees at SpaceX’s Starbase facility in Texas that the decision to go public was driven by the company’s next phase of expansion.

He said the funds raised would support large-scale growth initiatives, including the development of AI infrastructure in orbit—so-called space-based data centres designed to handle future computing demand.

The concept remains experimental, but Musk has previously argued it could help address growing energy and processing constraints associated with artificial intelligence systems.

Investors Watch Valuation Debate Closely

The IPO has sparked debate among analysts over whether SpaceX’s valuation is justified, given its aggressive expansion plans and heavy capital requirements.

Supporters point to its dominance in reusable rocket technology and satellite internet through Starlink, while critics highlight rising costs and unproven long-term revenue models for its AI and space infrastructure ambitions.

Despite differing views, the listing has already cemented SpaceX as one of the most significant public market debuts in history.