North Carolina State Treasurer Brad Briner said this year’s most talked-about IPO was too expensive for his pension fund to own.
Breiner, who oversees about $200 billion in funding for North Carolina’s teachers, firefighters and police officers, said the state is investing heavily in artificial intelligence startups OpenAI and Anthropic while avoiding a direct stake in SpaceX, which is scheduled to go public on Friday, due to concerns that Elon Musk’s $1.77 trillion valuation leaves little room for future profits.
“With SpaceX, there are pricing issues that we’ve been concerned about for the past year or so,” Breiner said Wednesday on CNBC’s “Squawk Box.” “Elon Musk, amazing entrepreneurs, amazing techniques for starting a business, amazing things, etc. But at some point, things come at a high enough price. We’re trying to build predictable returns in the high single digits for retirees. And when you do that, you have to consider valuation. So, certainly, SpaceX’s $1.75 trillion is a big valuation.”
SpaceX plans to price its IPO on Thursday and begin trading on Friday. The rocket maker plans to sell 555.6 million shares at $135 a share, raising about $75 billion and valuing the aerospace company at about $1.8 trillion.
Briner’s comments highlight a growing debate among institutional investors as SpaceX prepares for what is expected to be the largest initial public offering in history. While many asset managers see the company as a unique asset with its dominant position in rocket launches and satellite internet, other long-term investors are questioning whether today’s valuation already reflects much of that optimism.
The state’s treasurer has instead directed capital toward AI companies that it believes offer stronger risk-reward opportunities. North Carolina has invested about $40 million in OpenAI and about $250 million in Anthropic earlier this year, a position now worth more than $600 million, he said.
“Earlier this year, we saw an opportunity in Anthropic, which we thought was completely mispriced,” Breiner said. “With that technology, you can see how powerful it is.”
Briner said North Carolina’s pension system expects to gain exposure through an index fund if the company goes public, rather than buying SpaceX stock on the private market.
“We ultimately plan to participate in SpaceX through a public equity index position, but we do not have a private equity position,” he said.
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