Scottish Mortgage SpaceX stake worth just under £3bn ahead of IPO

(Sharecast News) - Scottish Mortgage Investment Trust said on Tuesday that its holding in SpaceX is worth just under £3bn.

Ahead of Elon Musk's expected IPO of the rocket maker this summer, the trust said the fair value of its holding was £2.98bn as at 31 March.

According to various media reports, SpaceX is targeting a valuation of about $1.75tn and aiming to raise between $50bn and $75bn, which would make it the largest IPO in history - more than three times the size of Chinese ecommerce giant Alibaba's 2014 offering.

Scottish Mortgage said: "Our current carrying value for SpaceX sits below the $1.75tn figure reported in the press - this is deliberate.

"Baillie Gifford Valuations Team, along with our independent third-party provider S&P Global, values private holdings based on verifiable transactions, not press speculation."

The trust first invested in SpaceX in December 2018, deploying capital until August 2021. It has invested a total of £151m and said there has been no additional capital deployed in the last five years.

Scottish Mortgage said the full S-1 prospectus, expected in May or June, will be the first time the audited financials will be publicly available, the precise use of proceeds, and the detailed terms of the offering.

Until then, the valuation and potential raise figure circulating in the press "are based on speculation and unverifiable reporting and should be treated accordingly," the trust said.

As far as lock-up terms are concerned, it said we don't yet know what restrictions will apply to existing shareholders post-listing, how long any lock-up period will last or whether Scottish Mortgage will be subject to the same terms as other pre-IPO investors. It noted that differentiated lock-up schedules are common.

"Based on our experience with other private companies that have listed, a lock-up of around six months post-listing is typical, though terms may vary," it said. "This matters because the conversion of our SpaceX position from a private holding to a listed security will change how it is valued in our NAV on a daily basis - and any lock-up period would affect our ability to manage position size in response to price movements after listing.

"The mechanics of when and how we can transact, and at what scale, remain unknown until the prospectus and any accompanying shareholder agreements are published."

Scottish Mortgage