North Carolina Pension Fund Rejects SpaceX IPO Over Valuation

North Carolina State Treasurer Brad Briner said the state's pension fund will not purchase shares in SpaceX's upcoming IPO due to valuation concerns.

The decision signals a shift in how some of the largest public institutional investors view the risk-to-reward ratio of aerospace giants compared to the rapid growth of artificial intelligence.

Speaking Wednesday on CNBC’s "Squawk Box," Briner said the state's $200 billion ^[2] pension fund is passing on the opportunity because the company's current valuation is too steep. He said that SpaceX's valuation, cited between $1.75 trillion ^[1] and $1.77 trillion ^[1], offers limited potential for growth for the fund's specific needs.

"SpaceX at $1.75 trillion is a big valuation," Briner said.

Instead of the aerospace firm, Briner said the state will look toward the AI sector. He said the fund will focus on companies such as OpenAI and Anthropic, which he believes offer better upside than the current price of SpaceX shares.

"We think the valuation is too high for our fund and we’ll focus on AI companies like OpenAI and Anthropic instead," Briner said.

This cautious approach to the IPO follows a broader strategy of active management for the state's assets. Briner has previously indicated a willingness to make bold moves regardless of public perception. In an interview with The News & Observer on June 8, he said, "We won’t shy away from taking action, even if it’s controversial."

The refusal to invest in one of the world's most anticipated IPOs highlights the tension between the perceived prestige of high-profile tech firms and the fiduciary duty to maximize returns for retirees. While SpaceX has dominated the commercial launch market, the North Carolina fund is prioritizing the generative AI boom as its primary engine for growth.