SpaceX is considering a potential merger with Tesla Inc., as well as an alternative combination with artificial intelligence firm xAI, according to people familiar with the matter, a sign billionaire Elon Musk is weighing how to consolidate his empire.

Tesla shares jumped 4% on the news.

The firm has discussed the feasibility of a tie-up between SpaceX and Tesla, an idea that some investors are pushing, the people said, asking not to be identified as the information isn’t public. Separately, they are also exploring a tie-up between SpaceX and xAI ahead of an IPO, some of the people said.

Any transaction could attract sizeable interest from infrastructure funds and Middle Eastern sovereign investors, some of the people said. A deal could also potentially require a large financing component, one of them said.

No final decisions have been made, details could change and the companies could decide to remain separate, the people said. Musk and representatives for SpaceX, xAI and Tesla didn’t immediately respond to requests for comment.

Different parts of Musk’s grand vision for SpaceX — of the company putting data centers into space to do complex computing for AI — would potentially be served by the various scenarios. xAI could benefit enormously from computing capacity provided by SpaceX’s data centers in orbit, if the company can make the engineering work.

Tesla’s ability to manufacture energy storage systems could help SpaceX use solar energy in space to run the data centers. Musk has also discussed using SpaceX’s Starship rockets to carry Tesla’s Optimus robots to the moon as well as to Mars.

The stock had fallen 3.5% during normal hours, giving the company a market value of about $1.56 trillion. SpaceX is targeting an IPO that would value the company at about $1.5 trillion, Bloomberg News has reported.

Two legal entities with the phrase “merger sub” in their names were set up in Nevada on Jan. 21 that count SpaceX Chief Financial Officer Bret Johnsen as officers, Nevada’s business portal shows.

Reuters reported the potential merger between SpaceX and xAI earlier. Shares of xAI would be exchanged for shares in SpaceX, Reuters said, citing a person familiar with the matter.

Some xAI executives may have the option to receive cash instead ‍of SpaceX stock as part of the merger, Reuters said.

SpaceX is weighing a June listing, around Musk’s birthday, and could seek to raise as much as $50 billion, people familiar with the matter have said. That would make it the biggest IPO of all time. Bank of America Corp., Goldman Sachs Group Inc., JPMorgan Chase & Co. and Morgan Stanley are expected to have senior roles.

Robinhood Markets Inc., the upstart broker credited with getting young people hooked on trading, is vying for a key role in SpaceX’s blockbuster initial public offering, Bloomberg News reported Wednesday.

SpaceX’s Johnsen told employees in December that a potential IPO would help fuel an “insane flight rate” for its developmental Starship rocket and a possible base on the moon.