SpaceX to reserve 5% of IPO shares for select individuals, waive lock-up periods

Elon Musk's space exploration company, SpaceX, is planning a non-traditional approach for its initial public offering (IPO), reserving approximately 5% of its shares for select employees and individuals chosen by senior executives. These shares will be offered at the IPO price through a directed share program, according to a regulatory filing released Monday. Any shares not purchased under this program will be made available to the general public.

SpaceX is reportedly seeking a valuation of around $1.75 trillion and is deviating from standard corporate practices regarding share sales. Unlike most new public companies, which impose a six-month lock-up period on insiders after their IPO, SpaceX is creating exceptions for some participants. The company plans a phased release of restricted shares, with some releases tied to company performance and stock price targets.

Under this structure, certain shareholders may begin selling their stakes after the first quarterly earnings report following the IPO, provided specific conditions are met. Remaining restricted shares will be gradually unlocked over subsequent months, with all restrictions fully lifted after six months. CEO Elon Musk holds about 85.1% of SpaceX's voting power and 12.3% of Class A shares. He has committed not to sell any stock for approximately one year after the company goes public. Other major investors also face a one-year lock-up period, though details of their holdings have not been disclosed.