Tesla’s move beyond cars official with $2b SolarCity
san francisco — Elon Musk’s Tesla Motors officially moved beyond cars and became a cleanenergy company Thursday, as shareholders overwhelmingly approved the acquisition of SolarCity Corp.
The deal, valued at about $2 billion, will integrate the maker of all-electric cars and batteries with the installer of rooftop solar panels. More than 85 per cent of Tesla shares voted in favour of the merger.
The deal, which sparked controversy over debt and corporate-governance concerns, is a win for Musk’s vision of Tesla as one-stop shopping for consumers eager to become independent of fossil fuels. Now comes the task of integrating two companies that have a track record of fleeting profits and frequent fundraising needs — not to mention thousands of employees.
“We’re trying to make an integrated product,” Musk said during a meeting with Tesla shareholders in Fremont, California, Thursday. “So you have an integrated solar roof with a Powerwall and an electric car, and you just go into a Tesla store, just say yes, it just happens. It all works, it’s seamless and you love it.”
Tesla plans to leverage its formidable brand and retail network with SolarCity’s network of rooftop solar installers and recently announced a “Solar Roof” product. It’s not clear what role Lyndon Rive, SolarCity’s chief executive officer and Musk’s cousin, will play in the combined company.
“With an 85 per cent vote, you’re seeing long term shareholders say we’re voting for Elon,” said Ben Kallo, an analyst with Robert W. Baird. “They’re saying ’We’re not here for the next quarter, we’re here for three or five years.’” It wasn’t clear when the merger will officially close. SolarCity is expected to cease being a stand-alone brand, as Tesla markets its Powerwall battery for the home as a Tesla Energy Product.
“Moving forward I think SolarCity becomes a part of Tesla Energy, but I don’t think that happens overnight,” said Kallo.
During the course of his fivemonth campaign for the merger, Musk revealed the solar roof product on the “Desperate Housewives” set at Universal Studios in Los Angeles last month. Musk said Thursday the product will be equivalent in cost, or slightly cheaper, than a normal roof and that installations will begin in volume in mid-2017. — Bloomberg
85% Tesla shares voted in favour of the merger