Future Fund Managing Director Gary Black pushed back on Thursday against speculation that SpaceX (NASDAQ:SPCX) could acquire Tesla Inc. (NASDAQ:TSLA), arguing that Elon Musk’s voting control does not free the SpaceX board from its fiduciary obligations. Black stated that a deal at current valuations would result in unacceptable dilution for SpaceX shareholders, countering recent support for the merger from venture capitalist Chamath Palihapitiya.

Musk Control Does Not Erase Board Duties

Black emphasized that despite Musk owning 82% of SpaceX’s voting control and 42% of its equity, the board cannot ignore its responsibilities to public shareholders. "Those who think $SPCX will buy $TSLA don’t understand the concept of board fiduciary duty," Black wrote on X. He noted that SpaceX’s prospectus confirms Musk retains the power to elect the board, but this does not "magically let the SPCX board off the fiduciary hook."

Dilution Math Undersells A Tesla Takeover

SpaceX shares traded near $131 on Friday, below the $135 IPO price and significantly lower than post-listing highs. Black argued that using stock to acquire Tesla would require issuing substantial new shares, severely diluting existing SpaceX investors. "At $132 and sinking, SPCX can’t just buy TSLA in a 25% dilutive equity deal," Black said. "The math won’t pass muster."

Conflicting Views on Merger Logic

The debate follows comments from Chamath Palihapitiya, who told CNBC there was "a very obvious industrial logic" to combining the companies under one capital structure. Palihapitiya suggested a merger would facilitate fundraising for Musk’s various projects and estimated Tesla might require a 50% premium in an acquisition due to its volatility and litigation risks. He also highlighted SpaceX’s potential to build a consumer wireless business using spectrum licenses acquired from EchoStar Corp. for about $17 billion.

Wall Street has offered mixed assessments. Jefferies estimated a nil-premium transaction could leave Musk with 55.3% voting control, while JPMorgan called a combination "strategically coherent on paper" regarding AI and robotics integration, though it warned of governance and regulatory hurdles. Conversely, hedge fund manager George Noble criticized the SpaceX IPO as potentially the "largest exit liquidity operation in history," arguing insiders bought at lower prices.

Tesla is scheduled to report second-quarter results on July 22. Wall Street expects earnings of 32 cents per share and revenue of $26.02 billion, following reported vehicle deliveries of 480,126 for the quarter.

SpaceX (NASDAQ: SPCX) has expanded its footprint across U.S.-listed ETFs, appearing in 179 funds that include value-oriented portfolios traditionally focused on mature, lower-valuation companies. According to Morningstar, the rocket company’s presence in value ETFs underscores how modern index construction has evolved to incorporate measures such as profitability, cash generation and quality alongside traditional valuation metrics.

Why SpaceX appears in value ETFs

Traditional value investing typically targets companies trading at low valuations relative to earnings or book value. SpaceX, however, commands a premium valuation driven by growth expectations in satellite broadband, launch services and defense contracts. Contemporary value strategies increasingly combine valuation screens with quality and profitability characteristics, allowing companies like SpaceX to qualify for portfolios that once excluded them.

Value ETFs holding SpaceX

Morningstar’s analysis identifies several major value ETFs holding SpaceX. The Schwab U.S. Large-Cap Value ETF (NYSE: SCHV) and the Strive 1000 Value ETF (NYSE: STXV) are among the largest holders. SpaceX is also included in the iShares Russell 1000 Value ETF (NYSE: IWD) and the Vanguard Russell 1000 Value ETF (NASDAQ: VONV), both of which track the Russell 1000 Value Index.

The iShares Russell Top 200 Value ETF (NYSE: IWX) holds SpaceX at roughly 0.03% of its portfolio. Smaller allocations are present in the Fidelity Enhanced Large Cap Value ETF (NYSE: FELV) and the Goldman Sachs MarketBeta Russell Large Cap Value Equity ETF (NYSE: GVUS).

Broader ETF ownership

SpaceX’s reach extends beyond value strategies to include broad-market index funds, growth ETFs, quality and momentum strategies, and multi-factor portfolios. Thematic funds such as the ARK Space Exploration & Innovation ETF (BATS: ARKX) and the Procure Space ETF (NASDAQ: UFO) provide targeted exposure to the commercial space economy. Dedicated leveraged and inverse products, including the Kurv SpaceX Enhanced Income ETF (BATS: XSHP) and the Tradr 2X Long SpaceX Daily ETF (BATS: SPCM), offer concentrated exposure.