The honeymoon is over for the biggest flotation in stock market history. SpaceX shares fell below their $135 IPO price for the first time on Wednesday, leaving thousands of UK retail investors who put £271 million into Elon Musk’s space venture staring at paper losses barely a month after its debut.
Shares in the satellite, rockets and artificial intelligence company slid 2.5 per cent to $132.64 in lunchtime trading, dipping under the price set when it made its stock market debut on June 12. The stock pared its losses to close at $135.27, down $0.81, or 0.6 per cent, on the day.
It is a sobering moment for a listing that only last month saw shares touch $150 on day one. The oversubscribed float attracted huge global interest from institutional and ordinary investors alike, promoted by 23 banks including Goldman Sachs, Morgan Stanley, Bank of America, Citigroup and JPMorgan Chase, which are reported to have collectively earned hundreds of millions in fees.
For the ordinary savers who piled in, the picture is less rosy. SpaceX courted retail investors on an unprecedented scale in the run-up to the float, allocating 20 per cent of IPO shares to non-professional investors drawn to Musk and his pledge to build “the systems and technologies necessary to make life multiplanetary”. UK retail investors alone spent £271 million to be part of it.
Many of those backers will be business owners and entrepreneurs who saw the float as a once-in-a-generation opportunity. The outlook for anyone who bought at the IPO price and held on is now uncertain.
Support authors and subscribe to content
This is premium stuff. Subscribe to read the entire article.
