In June 2026, SpaceX agreed to buy the AI-coding startup Cursor for a jaw-dropping $60 billion — and barely any cash changed hands. No giant wire transfer, no vault emptied. So how do you "pay" $60 billion for a company without writing a $60 billion cheque?
The answer is one of the most important — and least understood — decisions in business: how a deal is paid for. Every acquisition is settled in one of three ways — all-stock, all-cash, or a mix — and that single choice reshapes who takes the risk, who keeps the upside, and sometimes whether the deal succeeds at all. Here's how it works, told through three landmark deals.
First: merger vs acquisition
A quick distinction. In an acquisition, one company buys another and is clearly the new owner (Microsoft acquired LinkedIn). A merger is, in theory, two companies combining as equals into a new entity. In practice the line blurs, and the payment question is the same for both: where does the money — or the value — actually come from?
The three ways to pay
Each structure answers the same question — how does the seller get paid? — in a different way, and each hands the risk to a different party. Let's see all three in the real world.
All-stock: paying with your own shares (SpaceX–Cursor)
In an all-stock (or "stock-for-stock") deal, the buyer doesn't hand over money — it hands over newly issued shares of itself. Cursor's owners didn't get $60 billion in cash; they got SpaceX stock worth roughly that much.
Why would SpaceX do this? Because its shares had just become an extraordinarily valuable currency. Days earlier, SpaceX had pulled off a record-breaking IPO and its stock had soared — so paying in shares let it preserve cash and fund a megadeal it could never have settled in cash. (We covered the mechanics in SpaceX's $60 billion Cursor deal.) When your stock is red-hot, it's the cheapest money you'll ever spend.
There's a deeper logic, too: in an all-stock deal, the seller's payout rises and falls with the buyer's future. Cursor's shareholders are now betting on SpaceX. That can be a feature — shared upside — or a trap.
The cautionary tale: AOL–Time Warner
History's most infamous all-stock deal shows the danger. In 2000, at the peak of the dot-com bubble, AOL used its sky-high stock to buy Time Warner for about $165 billion — the classic move of spending an over-inflated "currency." Then the bubble burst. AOL's value collapsed, the combined company posted a ~$99 billion loss in 2002 (a US record at the time), and it went down as the worst merger in corporate history. The lesson: when the stock you pay with is overvalued, an all-stock deal can vaporize value on a historic scale.
Cash: the clean version (Microsoft–LinkedIn)
An all-cash deal is exactly what it sounds like: the buyer pays money, the seller takes it, and the relationship ends there. In 2016, Microsoft bought LinkedIn for $26.2 billion in cash — $196 per share — funding it largely by issuing new debt rather than dipping into its own reserves.
Cash is what most sellers quietly prefer: it's certain and immediate. A bird in the hand beats shares whose value might swing. The trade-offs sit with the buyer — it spends precious cash (or takes on debt) — but it also keeps all of the future upside for its own shareholders. One catch for the seller: cash is usually taxable right away, whereas an all-stock deal can often defer that tax.
Mixed: a bit of both (Disney–Fox)
Most big deals land in between. A mixed (cash-and-stock) deal blends certainty with shared upside. When Disney acquired 21st Century Fox for roughly $71 billion in 2019, it paid in both cash and stock — giving Fox's shareholders some guaranteed money and a stake in Disney's streaming future.
Disney–Fox even illustrates how fluid this can be: the deal started as an all-stock agreement worth about $52.4 billion, then — after Comcast jumped in with a rival bid — Disney restructured it into a larger $71.3 billion cash-and-stock offer to win. The payment structure isn't fixed; it's a negotiating lever.
So why choose one over another?
It usually comes down to three things: how richly the buyer's stock is valued, how much cash it has, and how confident it is. A company with soaring shares (SpaceX) pays in stock — cheap currency, cash preserved. A cash-rich, confident buyer (Microsoft) pays cash to keep all the upside. And when a buyer wants to balance the two — or sweeten a contested deal — it mixes them (Disney).
What it means for shareholders
This is where it gets personal, whether you own shares in the buyer or the seller:
- If you own the target (the company being bought): cash gives you certainty and money now (but a tax bill); stock gives you upside and downside in the buyer, usually with deferred tax. Your payout's fate changes completely depending on the structure.
- If you own the buyer: an all-stock deal dilutes your ownership — your slice of the company shrinks as new shares are printed. A cash deal spends money or adds debt instead. Neither is free.
- The hidden signal: when a confident company chooses to pay in stock, it can quietly hint that management thinks its own shares are richly priced — better to spend "expensive" stock than precious cash. Savvy investors read the payment method as a tell.
The 2026 twist: all-stock is back
There's a reason all-stock megadeals — like SpaceX–Cursor — are suddenly everywhere again. Sky-high technology and AI valuations have turned hot stocks into a cheap acquisition currency, exactly as the dot-com boom did in 2000. That's powerful when the value is real. But it carries an unmistakable echo of AOL–Time Warner: if today's AI valuations prove frothy, some of 2026's all-stock deals could age just as badly. Same playbook, same promise — and the same risk.
Frequently Asked Questions
What is an all-stock deal?
An all-stock (or "stock-for-stock") deal is an acquisition paid for with the buyer's own newly issued shares instead of cash. The seller's shareholders receive stock in the buyer, so their payout then rises and falls with the buyer's future performance — as in SpaceX's all-stock purchase of Cursor.
What's the difference between a cash deal and a stock deal?
In a cash deal the seller gets money up front — certain, immediate, but usually taxable now (e.g., Microsoft–LinkedIn). In a stock deal the seller gets the buyer's shares — sharing the buyer's future upside and downside, often with deferred tax. A mixed deal combines both.
Why did SpaceX pay for Cursor in stock instead of cash?
Because its shares had just become extremely valuable after a record IPO. Paying in stock let SpaceX preserve cash, fund a deal far too large to settle in cash, and have Cursor's owners share in its future. When a company's stock is soaring, it's a cheap currency to spend.
Is cash or stock better for the seller?
Neither is universally better. Cash offers certainty and immediate value (a "bird in the hand"), but is typically taxed straight away. Stock offers a share of the buyer's upside and often defers the tax — but you also take on the buyer's risk. It depends on the seller's confidence in the buyer and tax situation.
Why was the AOL–Time Warner merger such a disaster?
AOL used its dot-com-bubble-inflated stock to buy Time Warner for ~$165 billion in 2000. When the bubble burst, AOL's value collapsed, the company posted a ~$99 billion loss in 2002, and the deal became the worst merger in history — the textbook warning about paying with overvalued stock.
The bottom line
You can buy a $60 billion company without cash — you simply pay with your own shares, as SpaceX did with Cursor. But the choice between stock, cash, and a mix is never a mere technicality. It decides who carries the risk (the buyer's lenders, or the seller's shareholders), who keeps the reward, and — as AOL–Time Warner proved — whether a triumphant deal becomes a historic blunder.
So the next time a giant acquisition makes headlines, look past the price tag to the structure. How a company chooses to pay tells you what it really believes — about its target, about the future, and about the value of its own stock.
Related on PrimusSource: SpaceX Buys AI Startup Cursor for $60 Billion, Inside the 2026 Tech IPO Boom and How Forex Reserves Become a Country's Economic Superpower.
Sources
- Microsoft to acquire LinkedIn for $26.2 billion in all-cash deal — Microsoft (2016)
- Microsoft to buy LinkedIn for $26.2 billion — CNBC
- Disney and 21st Century Fox announce per-share value in $71 billion acquisition — The Walt Disney Company (2019)
- Acquisition of 21st Century Fox by Disney (cash-and-stock structure) — Wikipedia
- 15 years later, lessons from the failed AOL–Time Warner merger — Fortune
