Baillie Gifford clients poised for SpaceX windfall – Daily Business

Elon Musk: record flotation

Clients of investment manager Baillie Gifford are poised to reap a £3.5 billion return on its early bet on SpaceX as Elon Musk’s rocket company prepares for what is expected to be the largest public listing in stock market history.

Analysis of Baillie Gifford’s four flagship investment trusts found that the Edinburgh-headquartered asset manager could book an average return of 18 times its initial investment, should SpaceX achieve its rumoured $1.75 trillion (£1.3 trillion) IPO valuation, City AM reports.

SpaceX submitted confidential paperwork to the US Securities and Exchange Commission (SEC) this month and is sounding out potential investors ahead of a market launch later this year,.

Musk hopes to raise $75bn (c. £56bn) to fund an ambitious rocket programme and space-based artificial intelligence ventures.

Baillie Gifford’s fund managers were among SpaceX’s earliest institutional backers, first taking a stake in 2018 when the company was valued at $31bn (c. £23bn). The total value of the firm’s holdings across its trusts is now estimated at £3.9bn based on recent London Stock Exchange filings.

The lion’s share of that gain is set to flow through Scottish Mortgage, the UK’s largest investment trust, which holds more than 20% of its portfolio in Musk’s space firm. Its stake, originally acquired for around $200 million (c. £150m), is expected to be worth £3bn at the point of listing.

The forthcoming flotation will also deliver meaningful gains for Baillie Gifford’s smaller vehicles. Edinburgh Worldwide Investment Trust is on course for a 21.9 times return, with its stake growing from an initial £8.5m to an estimated £186m, whilst USA Growth Trust’s holding is set to rise from £6.5m to £125m. 

Both trusts, alongside the FTSE 250-listed Schiehallion fund, trimmed some of their SpaceX exposure during a funding round late last year to reduce portfolio concentration.

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