# Barry Diller Offers to Buy Rest of MGM in Deal Valued at Nearly $19 Billion

An episode of [Bloomberg Intelligence](https://invisiblenetwork.ai/podcast/326301337), 1 Jun 2026, 21 min.

Audio: https://podtrac.com/pts/redirect.mp3/tracking.swap.fm/track/UVBrz8bN8aM2Xe47PEPu/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/7f534b8c-9e91-429a-b102-ae3c00090c6d/9515e805-5b7c-4209-8c1c-b45c01147076/audio.mp3?utm_source=Podcast&in_playlist=0ad812bf-fd15-4012-a18c-ae3c00090c76

Watch Paul and Scarlet LIVE every day on YouTube: http://bit.ly/3vTiACF. Bloomberg Intelligence hosted by Paul Sweeney and Scarlet Fu -Jody Lurie, Bloomberg Intelligence Credit Analyst, discusses Barry Diller making an offer for the remaining portion of MGM Resorts International he doesn’t already own through his business empire, People Inc. -Matthew Palazola, Bloomberg Intelligence, Senior Analyst, P&C Insurance, discusses the latest at Berkshire Hathaway. Berkshire Hathaway Inc. will acquire Taylor Morrison Home Corp. in an all-cash deal worth about $6.8 billion. The offer of $72.50 per common share represents a 24% premium to the home builder’s latest closing price on Friday. -Mandeep Singh, Global Tech Research Head at Bloomberg Intelligence, discusses Nvidia entering the PC market with a new chip called RTX Spark Superchip to loosen Intel Corp.'s stranglehold and modernize machines for the AI era. - Isabelle Lee, Bloomberg Cross Asset Reporter, discusses the Bloomberg Big Take: "SpaceX IPO Forces Wall Street to Reorganize Around.” Even if all SpaceX's IPO does is break the record for the biggest ever listing, the world of finance has already changed. The company’s ambitious listing plan is set to clear the way for other mega-offerings. It also risks threatening the integrity of the market itself. See omnystudio.com/listener for privacy information.

## Transcript

[0:02] Speaker 1: Bloomberg Audio Studios, podcasts, radio news. You're listening to the
[0:10] Speaker 1: Bloomberg Intelligence Podcast. Catch us live weekdays at ten am
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[0:21] Speaker 1: or watch us live on YouTube.
[0:23] Speaker 2: All right, it is Monday, which means M and A
[0:26] Speaker 2: is in the house right now. And one of the
[0:28] Speaker 2: big ones that we're keeping an eye on here is
[0:31] Speaker 2: people offering to buy MGM Resorts for forty eight dollars
[0:34] Speaker 2: thirty cents a share in cash. And for anyone who's wondering,
[0:37] Speaker 2: people incorporated as a company controlled by Barry Diller. So
[0:41] Speaker 2: let's bring in Jody Lourie. She's our senior credit analyst
[0:44] Speaker 2: for more on this. Jody walk us through what this
[0:46] Speaker 2: looks like, because this is forty eight dollars storty cents
[0:49] Speaker 2: a share in cash.
[0:50] Speaker 3: Is there going to be debt involved?
[0:52] Speaker 4: Oh, there is going to be debt involved, Starlette, I
[0:55] Speaker 4: will not doubt that by any measure.
[0:58] Speaker 3: Now, of course, is the deal going to get done?
[1:00] Speaker 3: That's the bigger question.
[1:01] Speaker 4: But right now, so people owns twenty six point one
[1:05] Speaker 4: percent and they're planning on increasing that by twenty four
[1:07] Speaker 4: percent in terms of total ownership, or twenty four percentage
[1:11] Speaker 4: points in total ownership, and so they want to own
[1:15] Speaker 4: fifty point one percent and have other investors on the
[1:18] Speaker 4: other amount.
[1:18] Speaker 3: Now, if you look.
[1:19] Speaker 4: At the whole package of that seventy four percent that's
[1:23] Speaker 4: getting acquired, we estimate that's about eight billion in debt.
[1:27] Speaker 4: If you exclude the amount of cash that people has
[1:30] Speaker 4: on hand, which is a little over a billion, it's
[1:32] Speaker 4: at one point one billion. So eight billion dollars is
[1:36] Speaker 4: quite a lot. Now, if you only look at what
[1:38] Speaker 4: they're going to buy, it's still you know, it's still
[1:41] Speaker 4: a large amount. It's still four or five billion dollar
[1:43] Speaker 4: in terms of leveraging up the company. So we're talking
[1:47] Speaker 4: leverage going from mid five times to mid seven times
[1:51] Speaker 4: on a lease adjusted basis for MGM. And we view
[1:54] Speaker 4: this less so as an acquisition by equals, more so
[1:58] Speaker 4: as an LBO type structure, So really just leveraging up MGM,
[2:02] Speaker 4: putting all the debt on MGM, and creating a situation
[2:05] Speaker 4: in which MGM's private, in which they have more debt
[2:08] Speaker 4: on the balance sheet and it's going to be at
[2:11] Speaker 4: odds with of course, the large leases that they already have,
[2:14] Speaker 4: which is about you know, three quarters of the debt
[2:17] Speaker 4: that they have on hand.
[2:19] Speaker 5: As a former banker, I don't like this balance sheet.
[2:21] Speaker 5: Start with what's your market telling you, Jody, I mean,
[2:25] Speaker 5: how did these does trade?
[2:27] Speaker 4: Yeah, so, Paul, it's one of those names that really
[2:30] Speaker 4: frustrates me in general, just because a few years ago
[2:32] Speaker 4: they decided to do a sale lease back of all
[2:34] Speaker 4: the US assets. So they got rid of all US
[2:37] Speaker 4: assets and instead went into this sale easepack structure, which
[2:43] Speaker 4: is basically, they pay rent, they pay rent, they pay
[2:46] Speaker 4: they pay taxes, they pay all the upkeeping capex and
[2:50] Speaker 4: operating operating costs on the properties. But they're a tenant
[2:55] Speaker 4: and so you look at that and you say, well,
[2:57] Speaker 4: wait a minute, what's the benefit of that. These are
[3:00] Speaker 4: long term structures with a few parties and you're paying constantly. Now,
[3:05] Speaker 4: it is a little bit cheaper in theory than borrowing
[3:08] Speaker 4: debt all the time, but it is one of those
[3:11] Speaker 4: situations that as a bondholder, you say, okay, if they
[3:13] Speaker 4: only have about five six billion, seven billion in debt outstanding,
[3:18] Speaker 4: but then they have about twenty nine billion or twenty
[3:21] Speaker 4: five billion excuse me, in operating leases, you're not really
[3:25] Speaker 4: a big fan of that. And so this is a
[3:28] Speaker 4: company where from a business perspective, it's really fantastic in
[3:32] Speaker 4: terms of the reach, in terms of the geo structure
[3:36] Speaker 4: that they have. I mean, they have buildings in Osaka,
[3:39] Speaker 4: you know, they have buildings. Obviously, they have MGM China,
[3:41] Speaker 4: which is based in Macaw, they have all throughout the
[3:44] Speaker 4: US and a really big stronghold in Vegas. But then
[3:47] Speaker 4: you just throw on those operating leases and as a
[3:49] Speaker 4: bondholder you can never get comfortable, but even more so
[3:52] Speaker 4: now when it's going to get levered up and so
[3:54] Speaker 4: the bonds are just widening.
[3:56] Speaker 3: Jody, what's going on in the casino sector. We had
[3:59] Speaker 3: you on last week when.
[4:01] Speaker 2: We talked about for Tita Entertainment buying Caesars, and now
[4:06] Speaker 2: you have people's buying the chunk of MGM resource that
[4:09] Speaker 2: doesn't already own what's happening in the casino business fundamentally
[4:12] Speaker 2: that is causing or that is triggering all this M
[4:14] Speaker 2: and A.
[4:16] Speaker 4: So Scarlett, I think we're in a little bit of
[4:18] Speaker 4: a late stage indication from a credit cycle perspective. If
[4:21] Speaker 4: I had to opine on it, just because you only
[4:25] Speaker 4: see these sort of scenarios in these later stages, right
[4:28] Speaker 4: that's when the LBOs happen. We also have the political
[4:31] Speaker 4: situation where things are a little bit more lax at
[4:33] Speaker 4: the DOJ and the SEC, and so that also opens
[4:36] Speaker 4: the door to these acquisitions getting done even being a possibility.
[4:41] Speaker 4: But for gaming in particular, it's sort of interesting because
[4:43] Speaker 4: we also have the prediction markets, which of course have
[4:45] Speaker 4: created all sorts of waves in the industry in terms
[4:48] Speaker 4: of the digital side of things. So that online gaming
[4:51] Speaker 4: sports betting component has been a big sort of avenue
[4:55] Speaker 4: for growth a lot for a lot of these companies
[4:57] Speaker 4: where it's really just you know, other is not really
[5:00] Speaker 4: a very exciting industry, and the prediction markets is definitely
[5:05] Speaker 4: shaking it up a little bit in the US and
[5:07] Speaker 4: causing questions of what's the next growth story. So it's
[5:10] Speaker 4: not really so surprising that these investors are coming in
[5:14] Speaker 4: and saying, hey, I can do a better job, particularly
[5:16] Speaker 4: investors that are already smart in the industry. They've already
[5:19] Speaker 4: been involved in it in some sense, or involved in
[5:21] Speaker 4: related industries in some sense. So we're not surprised as
[5:25] Speaker 4: much as we are intrigued and concerned for creditors.
[5:30] Speaker 3: Stay with us. More from Bloomberg Intelligence coming up after this.
[5:37] Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
[5:41] Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
[5:44] Speaker 1: Auto with the Bloomberg Business App. Listen on demand wherever
[5:47] Speaker 1: you get your podcasts, or watch us live on YouTube.
[5:51] Speaker 5: Let's talk about our good friends at Berkshire Hathaway. Matthew
[5:55] Speaker 5: palos Oli. He joints us here from Bloomberg Intelligence. He
[5:57] Speaker 5: covers all the insurance companies, including Berkshire Hathway Ay Berkshire
[6:00] Speaker 5: Hathway in the market again here for a deal. What
[6:03] Speaker 5: is Taylor Marson? And what if somebody is a Berkser
[6:08] Speaker 5: shareolder think about this deal?
[6:10] Speaker 6: So you may or may not recall I was in
[6:12] Speaker 6: here a couple of weeks ago and I had said
[6:15] Speaker 6: what I would like to see Greg Abell do is
[6:17] Speaker 6: hit some doubles and singles. Perhaps I think this is
[6:21] Speaker 6: exactly in line with that. So Taylor is a home builder.
[6:25] Speaker 6: Berkshire owns the biggest off site homebuilder in the country.
[6:31] Speaker 3: And what does off site home builder mean?
[6:33] Speaker 6: So they build the house and then they bring you
[6:35] Speaker 6: the house. So when I was at the annual meeting
[6:37] Speaker 6: in May. They literally had houses inside of the convention center,
[6:42] Speaker 6: and those houses more in the affordable end. This is
[6:47] Speaker 6: a vertically integrated company. Their company, they own Clayton, so
[6:50] Speaker 6: they do it from beginning to end. They sell the house.
[6:53] Speaker 6: The houses are maybe around two hundred thousand dollars. This
[6:55] Speaker 6: company they're buying fits very nicely with it because they're
[7:00] Speaker 6: an on site builder of more higher end homes, so
[7:04] Speaker 6: it's complementary to the business the business that they have.
[7:07] Speaker 6: They're not paying too much. It's eight point five billion,
[7:09] Speaker 6: that's about two percent of their three hundred and seventy
[7:11] Speaker 6: three billion cash as of March thirty first, and the
[7:16] Speaker 6: valuation these stocks have been beat up, as you might
[7:19] Speaker 6: have guessed, so the valuations down. I think I'm not
[7:22] Speaker 6: a home builder analyst, but Taylor was underperforming peers, and
[7:26] Speaker 6: I don't think Berkshire minds that all that much to
[7:28] Speaker 6: get it at probably a discount to its historical valuation.
[7:31] Speaker 2: And one thing that analysts point out is the fact
[7:35] Speaker 2: that greg Abel said that they want to overtime unify
[7:39] Speaker 2: our site built home building operations into a combined platform.
[7:43] Speaker 2: With this new purchase of Taylor Morrison and combine it
[7:45] Speaker 2: with Clayton Holmes. This is a different strategy, isn't it
[7:49] Speaker 2: from Berksher's usual approach of letting acquisitions run on their
[7:53] Speaker 2: own under their own branding.
[7:54] Speaker 3: Yeah.
[7:54] Speaker 6: No, that's a good thing to point out, Scarlett. They
[7:57] Speaker 6: typically Berkshire does not ever talk about synergies or or
[8:00] Speaker 6: or use that as any kind of justification forever buying something,
[8:03] Speaker 6: but greg Abel did specifically not so Clayton. They do
[8:07] Speaker 6: the business where they build a house and they bring you.
[8:09] Speaker 6: They have a smaller business where they do build it
[8:11] Speaker 6: on the site, and they were building building that unintended
[8:15] Speaker 6: over time through acquisitions. So what Able's saying is we're
[8:19] Speaker 6: going to take that business and probably fold it into
[8:21] Speaker 6: the tailor business and it's probably a better run through them. Also,
[8:26] Speaker 6: by the way, Berkshire owns a ton of manufacturing component businesses,
[8:33] Speaker 6: So Paul, you probably have the Benjamin Moore cea foam
[8:35] Speaker 6: pain in your shorehouse. That's a Berkshire Hathaway product.
[8:39] Speaker 7: Right.
[8:39] Speaker 6: They do flooring installations, all kinds of companies, and again
[8:44] Speaker 6: they don't talk about like having synergies here, but there's
[8:46] Speaker 6: definitely some opportunity to.
[8:48] Speaker 3: So they control a lot of the supply chain.
[8:49] Speaker 6: Yeah, and Taylor. While Clayton is vertically integrated, Taylor buys
[8:55] Speaker 6: from suppliers.
[8:56] Speaker 5: What's the cadence of acquisition activity for Berksher Hathaway. They
[9:00] Speaker 5: like to do one a year, two a year one.
[9:02] Speaker 6: We're just opportunistic, you know the answer to that, Paul,
[9:06] Speaker 6: They're going to do it when they see it in
[9:08] Speaker 6: the market.
[9:08] Speaker 5: They don't.
[9:09] Speaker 6: There's no timetable, there's no you know, we have to
[9:12] Speaker 6: do it. We have to deploy cash in any way.
[9:15] Speaker 6: They preach patients over anything. So I think it's you know,
[9:19] Speaker 6: when we see the deal, we do it. In the
[9:22] Speaker 6: note we put out today, we do have the deals
[9:24] Speaker 6: and capital deployment that they have done over time, and
[9:27] Speaker 6: it is I think more than you'd realize. They spend
[9:30] Speaker 6: twelve billion dollars on Google stock in the first quarter,
[9:32] Speaker 6: which is bigger than this acquisition.
[9:35] Speaker 2: We look at Berkshire Hathway shares and they've kind of underperformed,
[9:38] Speaker 2: down five point six percent this year when the SMP
[9:40] Speaker 2: is up about eleven percent. Does this kind of deal
[9:44] Speaker 2: help persure makeups some that gap?
[9:47] Speaker 7: Probably not.
[9:49] Speaker 6: I don't think so. I think this is probably able
[9:52] Speaker 6: building investor confidence over time. I mean, I think that
[9:56] Speaker 6: the the leaving of warm Buffett really left a whole
[10:00] Speaker 6: in the hearts and minds of people investing in the company,
[10:03] Speaker 6: and I think that needs to be rebuilt. I think,
[10:06] Speaker 6: ironically Berkshire's the kind of proto ANTIAI trade. You know,
[10:11] Speaker 6: they have all hard assets, they have a financial business,
[10:14] Speaker 6: and the insurance should you see the AI trade kind
[10:18] Speaker 6: of sell off be the natural company that I would
[10:20] Speaker 6: think would benefit from that. But even in the times
[10:22] Speaker 6: where that has happened earlier in the year, it hasn't
[10:24] Speaker 6: really over themed.
[10:28] Speaker 2: Stay with us more from Bloomberg Intelligence coming up after this.
[10:33] Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
[10:37] Speaker 1: weekdays at ten am Eastern on Apple, Cocklay and Android
[10:40] Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever
[10:43] Speaker 1: you get your podcasts, or watch us live on YouTube.
[10:48] Speaker 2: Video is entering the PC market with this new RTX
[10:51] Speaker 2: spark super chip. It's of course causing repercussions across a
[10:56] Speaker 2: chip space. We see Intel shares AMD shares to line.
[11:00] Speaker 2: Of course they are competitors. Let's bring in Mandeep Seing,
[11:03] Speaker 2: our global tech research head here at Bloomberg Intelligence for
[11:06] Speaker 2: more on this. So mand Jensen Hook made the announcement
[11:09] Speaker 2: in tipaid and Industry conference. How big a deal is
[11:12] Speaker 2: this that in Nvidia is entering the PC market.
[11:15] Speaker 7: Well, PC is a saturated market, you know, when you
[11:19] Speaker 7: think about the PC market, two hundred and fifty million
[11:21] Speaker 7: units a year grows probably low single digit So it's
[11:26] Speaker 7: not that exciting compared to some of the other stuff
[11:29] Speaker 7: that they've been doing on the server side and the
[11:31] Speaker 7: data center side, and the numbers would pay in comparison.
[11:35] Speaker 7: I think where they're going with this is they think
[11:39] Speaker 7: the physical AI would be a much bigger opportunity. Now,
[11:43] Speaker 7: when I say physical AI, it's your robotics, your humanoids
[11:47] Speaker 7: and that kind of stuff, and you're not going to
[11:49] Speaker 7: be able to do that just by focusing on the
[11:53] Speaker 7: server and the data center market. So they really want
[11:56] Speaker 7: to expand into other areas to build that ecosystem where
[12:00] Speaker 7: they have, you know, a PC footprint, and they just
[12:04] Speaker 7: don't want to be the chip provider anymore. That's been
[12:07] Speaker 7: Invidiou's key struality over the past few years is they
[12:10] Speaker 7: will give you all in terms of the Kuda software
[12:14] Speaker 7: stuff on the networking side, rather than just being confined
[12:18] Speaker 7: to being a GPU provider. And that's where they're going
[12:21] Speaker 7: with this is Look, you guys can run agentic AI
[12:24] Speaker 7: on our PCs. Now. Granted, their market share would be,
[12:29] Speaker 7: you know, low single digit. I don't expect it to
[12:31] Speaker 7: really take off and displace Intel our AMD, But what
[12:35] Speaker 7: they're trying to prove is the concept that in theory,
[12:39] Speaker 7: we can have our own PC and that is what
[12:41] Speaker 7: will position us well for that roboty if.
[12:43] Speaker 5: We choose to go down that d Yeah, the strategy
[12:47] Speaker 5: guy who advised Jensen Wang to do this, he'll be
[12:49] Speaker 5: out of a job in twelve months. I guarantee you.
[12:51] Speaker 3: This is why this PCs.
[12:54] Speaker 5: That's like some nineteen eighties dude. I mean, I'm an
[12:57] Speaker 5: AI company. I just want the AI or that's all
[13:00] Speaker 5: I want. I don't need to be making anything. I
[13:04] Speaker 5: don't want people touching my product. I just want to
[13:06] Speaker 5: be the AI company. That is what Scott Nvidia to
[13:09] Speaker 5: where it is now. I would argue it.
[13:10] Speaker 7: Has, but look at what they've done on the server side.
[13:14] Speaker 7: Server wasn't a very fast growing market. Suddenly everyone wants
[13:19] Speaker 7: to be in the server market. Why because the nature
[13:22] Speaker 7: of compute has changed with AI workloads, and with Agent TAKEAI,
[13:27] Speaker 7: we're talking about a very different type of compute than
[13:30] Speaker 7: what we are used to seeing on our desktops and laptops.
[13:33] Speaker 7: And so from that perspective, if the new interface for
[13:37] Speaker 7: Agent TAKEAI is conversational and a lot of stuff happens
[13:41] Speaker 7: in the background with an agent, then clearly your old
[13:45] Speaker 7: PC is not good enough for that.
[13:47] Speaker 5: Just doesn't have the technology chops that I do. I
[13:49] Speaker 5: can think way out in advance, and I don't want
[13:52] Speaker 5: to be with you exactly.
[13:54] Speaker 2: Clearly put into context for us another headline we got
[13:58] Speaker 2: on in video, which is it Saysthropic, Open AI and
[14:01] Speaker 2: SpaceX or among the first big users of this upcoming
[14:03] Speaker 2: microprocessor called Verra CPUs in their data centers. What is
[14:07] Speaker 2: this about and how does this fit in with the
[14:09] Speaker 2: broader strategy.
[14:11] Speaker 7: Yeah, so via Rubin, as you know, is their new
[14:13] Speaker 7: architecture after Blackwealth what they currently have, and they talked
[14:18] Speaker 7: about ramping it to full production in fall, and as
[14:22] Speaker 7: part of that they're really toouting you know, the CPU
[14:26] Speaker 7: portion of that Vira system that has got you know,
[14:30] Speaker 7: GPUs networking and everything in terms of an optimized system infrastructure.
[14:35] Speaker 7: So they are saying our CPU, which works very well
[14:39] Speaker 7: in this system. Integrated architecture will help you deploy agent AI.
[14:45] Speaker 7: And the reason why that stress on CPU is because
[14:48] Speaker 7: with Agent Tachai, the shift from chatbots to agent Takai,
[14:53] Speaker 7: the importance of CPU has grown. So they think CPU
[14:56] Speaker 7: is a big market and it's an important part of
[14:59] Speaker 7: that agentic rca detector and hence why this stress on SEA.
[15:02] Speaker 2: So black Claws, the current most advanced AI chip VIA
[15:05] Speaker 2: is the next generation.
[15:06] Speaker 4: That's right.
[15:07] Speaker 2: Stay with us. More from Bloomberg Intelligence coming up after this.
[15:15] Speaker 1: You're listening to the Bloomberg Intelligence podcast. Catch us live
[15:18] Speaker 1: weekdays at ten am Eastern on Apple Cockplay and Android
[15:21] Speaker 1: Auto with the Bloomberg Business app. Listen on demand wherever
[15:25] Speaker 1: you get your podcasts, or watch us live on YouTube.
[15:29] Speaker 5: We're supposed to be Isabell Lee Last Hour and extend.
[15:32] Speaker 5: They bait and switch me put Eric Malchunis in, which
[15:34] Speaker 5: was a crushing.
[15:35] Speaker 3: That was a downgrade for you.
[15:36] Speaker 5: That was a downgrade for you. But we got Isabella
[15:38] Speaker 5: Lee now cross Asser reporter for Bloomberg News. She's in
[15:40] Speaker 5: our studio.
[15:42] Speaker 3: You guys have a big take story out today.
[15:44] Speaker 5: Lu Wang Bailey, Lipschultz and you, Isabella Lee, this SpaceX ipo.
[15:48] Speaker 5: This is kind of setting new rules and new norms
[15:50] Speaker 5: for the IPO market, is it.
[15:52] Speaker 8: Yes, it's just so consequential. It's reorganizing a lot of
[15:55] Speaker 8: the parts of the markets, and one of those that
[15:57] Speaker 8: it's reorganizing is the stead quiet world of passive investing.
[16:01] Speaker 8: So because a lot of the companies behind the massive
[16:05] Speaker 8: indexes you can think of the company behind SMP five hundred,
[16:08] Speaker 8: NASAK one hundred, Russell, they're changing and have changed their
[16:12] Speaker 8: rules to accommodate megacap IPOs like SpaceX. They don't really
[16:17] Speaker 8: say it's for SpaceX, it's just SpaceX, because when companies
[16:20] Speaker 8: go public these days, it's they're mega companies as opposed
[16:24] Speaker 8: to in the past when they're just you know, a company. Now,
[16:26] Speaker 8: you scale privately, you raise funds privately, and when you
[16:29] Speaker 8: go public, you're the super giant company.
[16:31] Speaker 1: So for the.
[16:32] Speaker 8: NASAC, I think the seasoning period, which you can think
[16:34] Speaker 8: of it as a wait time before they add you
[16:36] Speaker 8: to the NASAK one hundred. It used to be three months.
[16:39] Speaker 8: They've narrowed it down to fifteen days. For foot T
[16:41] Speaker 8: one hundred, it's five days. SMP is still in consultation,
[16:44] Speaker 8: but from twelve months six.
[16:46] Speaker 2: Months, right, I mean it feels like they have to
[16:48] Speaker 2: go down that pass if everyone else did. Is this
[16:50] Speaker 2: a one time thing where they're changing for SpaceX or
[16:53] Speaker 2: is this from here on out?
[16:54] Speaker 3: Because if the SpaceX IPO goes off.
[16:56] Speaker 2: Without a hitch, then we're also going to see Anthropic
[16:59] Speaker 2: and open AI list as well, and they too could
[17:01] Speaker 2: then potentially join the NAS like one hundred after fifteen
[17:04] Speaker 2: trading days.
[17:04] Speaker 8: Yes, they never say it's for SpaceX, it's for megacap companies,
[17:08] Speaker 8: so one good thing. It's likely also for anthropic and
[17:11] Speaker 8: open AI. And this isn't unprecedented in the past, they've
[17:13] Speaker 8: also tried to change your rules to accommodate META if
[17:15] Speaker 8: I'm not mistaken in twenty twelve, but Annals estimate that
[17:19] Speaker 8: for SpaceX, if the rules apply, index funds would have
[17:22] Speaker 8: to buy twenty billion dollars worth of SpaceX shares, which
[17:26] Speaker 8: is a lot, and that could really move the markets.
[17:28] Speaker 8: And that's not even considering where it will be. Is
[17:31] Speaker 8: it going to be communication, Is it going to be industrial, Is.
[17:33] Speaker 3: It going to be what? Is it going to be
[17:34] Speaker 3: classic classication?
[17:36] Speaker 7: Yes?
[17:36] Speaker 8: Is it going to be a tech firm. So yeah,
[17:38] Speaker 8: no one knows, but it's.
[17:39] Speaker 5: Interesting you mentioned that because I was wondering, like what analysts,
[17:42] Speaker 5: which analysts on Wall Street will be covering the yes,
[17:45] Speaker 5: and so what I want to understand is a lot
[17:47] Speaker 5: of the aerospace and defense.
[17:49] Speaker 8: Rockets usually are industrials. But then if you look at
[17:51] Speaker 8: the revenue generating I mean, it has cloud services, deals
[17:54] Speaker 8: with anthropic that's communication.
[17:56] Speaker 3: Sorry, no, that's tech.
[17:58] Speaker 8: But then they Nicolas Colas of Data Trick awesome, he
[18:03] Speaker 8: said it might be communications because of the sales, and
[18:06] Speaker 8: guess we're alphabet and meta is communications.
[18:09] Speaker 2: No matter what, it's going to be the gigantic company
[18:12] Speaker 2: in that sector, especially if it's something like communications, which
[18:14] Speaker 2: doesn't have as many names as the tech sector.
[18:16] Speaker 8: One hundred percent. But it's just so unprecedented, to be honest,
[18:19] Speaker 8: and it will also pave the way for the mega
[18:21] Speaker 8: IPOs we're going to see at the end of this year.
[18:24] Speaker 5: And what I like about the Big Takes stories AI,
[18:26] Speaker 5: they're just really interesting stories, and they're deeply resourced and
[18:30] Speaker 5: deeply sourced all that kind of cool stuff. Even nice pretty.
[18:32] Speaker 3: Pictures likes always.
[18:35] Speaker 5: Help, And they've got a pretty picture about how SpaceX
[18:38] Speaker 5: IPO stacks ups in terms of offer size, the biggest
[18:42] Speaker 5: in terms of market cap one point eight trillion, second
[18:45] Speaker 5: only to a round.
[18:45] Speaker 8: I think can just compare on it.
[18:47] Speaker 5: It's just extraordinary. So it's way way off the grid here,
[18:52] Speaker 5: I guess, you know, do we expect this thing to
[18:55] Speaker 5: just do a normal road show? Are they going to
[18:56] Speaker 5: go to do we I haven't even seen a road
[18:58] Speaker 5: show schedule. Are they going to do in New York?
[19:00] Speaker 5: At they in London? And day that?
[19:01] Speaker 3: I'm not sure.
[19:02] Speaker 8: I think it's going to be mid June. But I
[19:03] Speaker 8: want to bring up one important point. Also, they're going
[19:05] Speaker 8: to allot thirty percent of retail traders, and just this
[19:08] Speaker 8: morning newsbrook that five percent will be allotted to employees,
[19:11] Speaker 8: which I think is more normal.
[19:12] Speaker 3: Why is that unusual? That's a huge.
[19:14] Speaker 8: Size because in the old playbook, it's institutional money that
[19:17] Speaker 8: gets a lot of this and retailers are just left
[19:19] Speaker 8: with leftovers. But now it's really putting the retail investors
[19:23] Speaker 8: to a pedestal and recognizing them to be an important part.
[19:26] Speaker 8: I mean, it's thirty percent, which is still minority compared
[19:29] Speaker 8: to seventy percent, but that's bigger than anything.
[19:32] Speaker 5: Well, my deals. If retail, that means this a bad deal.
[19:35] Speaker 5: I couldn't get to the institution.
[19:37] Speaker 3: But this is different. This is Elon, and I think
[19:39] Speaker 3: is it.
[19:39] Speaker 2: Different because does that mean there's gonna be enough demand
[19:42] Speaker 2: after the stock lists? And is a publicly traded company,
[19:45] Speaker 2: is it going to have that swell of demand that
[19:47] Speaker 2: usually boosts the share price.
[19:48] Speaker 8: I think that's what everyone's going to be worried about.
[19:51] Speaker 8: And then if you go through Reddit, the best source
[19:53] Speaker 8: on Earth.
[19:54] Speaker 5: I know I've got it on my phone, but I
[19:55] Speaker 5: just don't find it useful.
[19:57] Speaker 2: To talk about we're getting you, We're going to your
[20:00] Speaker 2: It's going to be convers people.
[20:01] Speaker 8: Where like why will I even buy? They think it's
[20:03] Speaker 8: a scam. We all know some people think that, but
[20:05] Speaker 8: others are like, why will I even try buying when
[20:07] Speaker 8: it's going to be in my index fund aka my
[20:09] Speaker 8: brache account soon, which again because of the seasoning shortened.
[20:14] Speaker 5: And then another little derivative trade is do I sell
[20:17] Speaker 5: my Tesla because I can get Ela on by just
[20:20] Speaker 5: owning SpaceX.
[20:21] Speaker 2: Too much concentration risk if you have both Tesla and SpaceX,
[20:24] Speaker 2: So if you.
[20:24] Speaker 8: Have an index fund, you've basically have SpaceX in a
[20:26] Speaker 8: few months.
[20:28] Speaker 1: This is the Bloomberg Intelligence Podcast, available on Apple, Spotify,
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