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Tesla and SolarCity shares up after Musk tweet

Monday, October 10, 2016 7:45
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Shares in both Tesla Motors (NASDAQ: TSLA) and SolarCity (NADAQ:SCTY) gained ground on Monday after Elon Musk performed an apparent U-turn and said neither needed to raise cash or debt in the current quarter as they head towards a merger.

Entrepreneur Musk is the chief executive of the electric car giant and the main shareholder and chairman at the solar power firm.

In a tweet on Sunday, Musk had stated he wanted to correct expectations that Tesla/SolarCity will need to raise equity or corp debt in the fourth quarter.

“Won’t be necessary for either,” he tweeted.

Two days before on Friday Tesla said in a regulatory filing that it intended to raise new funds by the end of the year.

The statement said the company’s current operations would provide “adequate liquidity” through to the end of the fiscal year, but it plans to raise additional funds before the year ends.

Musk proposed buying SolarCity in June and shares plunged 10% the following trading day. The proposed merger is set to go for a vote before shareholders in both companies.

He also tweeted on Sunday  that a new “Tesla product” would be unveiled on October 17 followed by the October 28 introduction of a combination of solar power, battery storage and electric-vehicle charging systems.

Speculation is mounting that it may be a new car or motorbike.

Shares in Tesla are up 3.45% to US$203.39 on Monday, while SolarCity shares are up 5.25% to US$19.66.

Story by ProactiveInvestors


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