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Musk drums up support for Tesla-SolarCity tie-up

Wednesday, November 2, 2016 8:13
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(Before It's News)

As energy combines go, plans for Tesla Motors (NASDAQ:TSLA) to tie with SolarCity (NASDAQ:SCTY) is a pivotal one for integrating renewable energy companies. It is just a shame that they share the same boss.

This week, the electric car maker whose autos are powered by lithium batteries, announced plans for Tesla to takeover SolarCity in what would mark a beefing up of its clean energy business.

Tesla founder Elon Musk said he is “pretty optimistic” shareholders will approve a $2.6bn deal to buy solar panel company SolarCity.

The billionaire, who is chairman of both companies, said he would be surprised if the deal did not go through next month.

Drumming up support for the takeover, Musk said early votes overwhelmingly favour the corporate move.

But some shareholders oppose the deal, arguing it is a conflict to combine two of Musk’s firms.

Tesla also sought to address concerns about SolarCity’s financial standing by revealing that the solar panel installer had raised about $1bn in funds in the last four months.

Mr Musk said there had been “quite a few naysayers”, including big hedge funds, about Tesla’s expansion into the energy business.

But he questioned how good they had been at predicting the outcome for Tesla in the past.

Investors will vote – a week after the outcome of the White House election race is known – on the deal on 17 November.

Tesla shares were down 0.5% at $189.73 while SolarCity shares were 1.1% lower at $18.86 on Wednesday.

Story by ProactiveInvestors

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