Tesla officially acquires SolarCity as shareholders of both Musk’s companies approved the deal last week by wide margins
Tesla Motors Inc. completed its $2.6 billion acquisition of SolarCity, a company spokesperson confirmed. The deal unites two of Elon Musk’s companies, enabling the billionaire to sell both electric cars and solar roofs to his customers under one corporate brand.
The company released a one-line statement saying: “We’re pleased to announce that Tesla’s acquisition of SolarCity closed this morning”. The deal unites two companies, enabling the billionaire to sell both electric cars and solar roofs to his customers under one corporate brand.
Last week, Shareholders of both Elon Musk’s companies approved the deal by 85 percent margin, which was first announced by Musk back in August. At the time, Tesla said that merging the two companies would allow them to scale their battery and solar energy operations. The resulting firm would be “the world’s only vertically integrated sustainable energy company”.
Tesla Chief Executive and also Chairman of SolarCity Elon Musk spent much of his Q&A session with shareholders last week talking about the new solar roof. Musk suggested the product would be cheaper, last longer and be more attractive than traditional roofs. As a bonus, it generates electricity. Customers can buy them to power their homes and charge their Tesla electric vehicles.
The first expected product to come out of the newly combined company is likely to be the Solar Roof Tesla showed off last month. The solar roof comes with four separate shingle options to cater to different housing aesthetics.
Elon Musk said about the agreement that its “blindingly obvious” in his mind, the desires of Tesla customers overlap with those of SolarCity. But the acquisition could be incredibly dangerous for both Tesla and Musk himself. It’s a long-term investment with short-term loss, and both Tesla and SolarCity will need reasonable amount to stay operational until agreement starts to bear fruit.
Merging the two companies is part of Musk’s Master Plan, which has Tesla expanding its offerings to include integrated energy generation and storage, entering the electric truck and bus markets, and vehicle sharing. Efraim Levy, analyst at CFRA Research said, “Whatever the synergies are down the road, it’s negative for current holders”