SpaceX Joins Neuralink in Leaving Delaware for Texas

In a strategic move that signals a broader shift in Elon Musk's corporate empire, SpaceX has announced plans to relocate its business incorporation from Delaware to Texas.

by Faruk Imamovic
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SpaceX Joins Neuralink in Leaving Delaware for Texas
© Getty Images/Omar Marques

In a strategic move that signals a broader shift in Elon Musk's corporate empire, SpaceX has announced plans to relocate its business incorporation from Delaware to Texas. This decision was disclosed in a recent filing with the Texas Secretary of State, marking a significant departure from the company's previous legal and tax domicile.

Musk's Dispute with Delaware

The catalyst for this change appears to be a legal battle involving Musk's other major venture, Tesla. A Delaware state judge recently ruled against Musk's 2018 Tesla pay package, siding with a shareholder who argued that the compensation was excessively large.

Delaware, known for its business-friendly legal environment, has long been the preferred state for incorporation by many of the U.S.' s largest companies. It offers benefits such as no sales tax, no tax on profits derived from intellectual property, and a favorable legal framework for mergers and corporate disputes.

However, the court's decision against Musk, which threatens to significantly impact his assets by potentially nullifying over $51 billion, has prompted the billionaire entrepreneur to reconsider his companies' ties to the state.

In a public statement on the social media platform X, formerly known as Twitter, Musk announced, "SpaceX has moved its state of incorporation from Delaware to Texas!" He further advised other companies to consider moving their incorporations away from Delaware, endorsing Nevada or Texas as preferable alternatives.

The Broader Implications of Musk's Move

This relocation effort by SpaceX is not an isolated event; it follows Neuralink, Musk's brain implant venture, in moving its incorporation out of Delaware. Neuralink has opted for Nevada as its new legal home, as reported by Bloomberg.

Musk's outspoken criticism of Delaware's legal framework for businesses and his recommendations for Nevada or Texas highlight his preference for states that he believes offer a more favorable environment for shareholder decision-making and corporate governance.

Musk has also initiated efforts to gain shareholder approval for moving Tesla's incorporation to Texas. This initiative was bolstered by a public poll Musk conducted on X, where an overwhelming majority of participants supported the idea of relocating Tesla's registration to Texas, where the company's operational headquarters is already based.

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