SpaceX snaps up AI coding startup Cursor for $60 billion days after historic IPO

SpaceX has announced the acquisition of AI coding startup Cursor for $60 billion, just days after its record-breaking initial public offering on the Nasdaq stock exchange. The deal, confirmed by Elon Musk's rocket company on Tuesday, involves exercising an option to buy the startup that specializes in AI-powered code generation tools, according to Business Insider. The acquisition signals SpaceX's growing interest in integrating advanced AI capabilities into its operations, potentially for software development and engineering applications related to its space exploration and Starlink projects. "The deal, confirmed by Elon Musk's rocket company on Tuesday, involves exercising an option to buy the startup that specializes in AI-powered code generation tools." The IPO valued SpaceX at over $2 trillion and raised $85.7 billion, making it the world's fifth most valuable company by Tuesday, surpassing Amazon, as reported by BBC. The acquisition follows a peculiar April arrangement where SpaceX agreed to either acquire Cursor for $60 billion or pay a $10 billion breakup fee, according to The Verge. The deal is expected to close in the third quarter, making Cursor a wholly owned subsidiary, NBC News reported. Cursor, created by Anysphere, is a popular AI coding assistant tool that uses artificial intelligence to automate code writing, according to BBC. The acquisition is seen as a move to strengthen SpaceX's enterprise AI capabilities and compete with rivals like Anthropic and OpenAI following its Wall Street debut, The Verge and NBC News reported. The two companies had been partners since April, when SpaceX secured the right to acquire Cursor for $60 billion, BBC added. "The IPO valued SpaceX at over $2 trillion and raised $85.7 billion, making it the world's fifth most valuable company by Tuesday, surpassing Amazon." The transaction is expected to close by the end of the quarter, according to SiliconAngle, which reported the deal is a stock transaction. The acquisition follows a previous partnership in April where SpaceX collaborated with Cursor to develop AI models optimized for coding tasks, with SpaceX initially stating it would pay $10 billion for the collaboration, SiliconAngle added. This marks one of the largest acquisitions in the tech industry, Business Insider noted.

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