Musk Waits in Hallway Outside Merger Talks Between His Two Companies

STARBASE, Texas — Elon Musk spent Tuesday afternoon on a chair in the hallway outside a conference room where independent directors of his two companies were deciding whether to merge them. He was too conflicted to come in.

“Because I’m a conflicted party, I can’t actually be in the discussions of the special committees,” Musk, the chief executive and largest individual shareholder of both SpaceX and Tesla, said on SpaceX’s earnings call that evening. He described it as “an odd kabuki dance where two groups of people are talking, and I can’t be in the conversation.”

Bev Lanyard, 52, a facilities coordinator, said the world’s richest man sat by the water cooler from 1:15 p.m. “He asked if either committee wanted anything from the vending machine,” Lanyard said. “Legally, that counted as a contact from both sides. Somebody from Tesla came out and took his quarters.”

Lawyers later taped a sign above his chair: “CONFLICTED PARTIES WAIT HERE.” Musk, who owns nearly a fifth of Tesla and just under half of SpaceX, is the only person in the building it applies to.

Corporate governance consultant Chet Recusal, 63, said the arrangement is standard. “The committees exist to protect shareholders from Mr. Musk,” Recusal said. “Mr. Musk is the shareholder. So you put him in the hall.” Musk pressed his ear to the door at about 3 p.m., Lanyard said.

To pass the time, Musk projected that the hallway would reach annual recurring revenue of $500 billion to $1 trillion by the end of 2027, the same range he later gave investors for SpaceX.

When this reporter left, the committees had not agreed on terms, and Musk had been asked to move two chairs farther down the hall, because both rooms could hear him agreeing with himself.