Tesla Offers to Buy SolarCity, Another Elon Musk Company, for $2.5 Billion
Tesla Motors wants to buy SolarCity, another company founded by Elon Musk, for $2.8 billion.
“Tesla’s mission has always been tied to sustainability,” the company wrote in a letter. We launched Tesla Energy, which through the Powerwall and Powerpack allow homeowners, business owners and utilities to benefit from renewable energy storage. It’s now time to complete the picture.”
However, investors were not enamored with the idea; shares of Tesla Motors dropped several percent in response to the potential transaction. Analysts admitted they saw the synergies proposed by Musk, but remain skeptical of the solar business and whether it’s the best thing Tesla can do with its capital.
Musk is focused on the synergies, however. It would create the world’s only vertically integrated energy company offering end-to-end clean energy products, and Tesla’s design and engineering experience would benefit SolarCity, while SolarCity’s mastry of distribution and financing products would benefit Tesla.
Musk called it “common sense” on a conference call.