US, Oct. 22 -- Elon Musk said that a merger between SpaceX and Tesla would be a "good idea", adding that special committees had been formed to discuss the possibility. If the deal goes through, the combined company could be worth around $3.5 trillion, making it one of the most valuable companies in the world.

Shares of the space and technology company rose in extended trading following the news. Tesla shares also gained after trading slightly lower for several weeks.

Speculation about SpaceX acquiring Tesla has grown in recent weeks. Last week, Barclays suggested that an announcement could come before Tesla's annual meeting in December.

Musk confirmed the discussions publicly for the first time, telling investors during a conference c...