Visionary electric carmaker Tesla has announced it is aiming to buy US solar panel producer SolarCity with a view to creating a powerful clean-energy unit under one roof. Shareholders were divided over the takeover bid.
Electric carmaker Tesla Motors confirmed Wednesday it was hoping to acquire solar panel producer SolarCity for up to $2.8 billion (2.5 billion euros). It indicated the idea was to create a one-stop shop for cleaner energy as consumers became more aware of the downsides of fossil fuels.
The all-stock bid valued SolarCity at $26.50 to $28.50 per share, depending on a review of the company’s books.
Tesla CEO Elon Musk is trying to bring together two units he knows very well. He is chairman of both companies and the largest individual shareholder in each, with a 26-percent stake in Tesla and a 22-percent stake in SolarCity.
Strategic alliance
Musk said both firms would be better off if their products were united under one roof and a common brand. If the deal went through, SolarCity would adopt Tesla’s name and sell its solar panels alongside power-storing batteries, he added.
SolarCity said in a statement it would carefully check the takeover bid, which came 14 months after the introduction of a battery system that stores solar energy in homes and businesses, making it easier for users to minimize their dependence on the power grids run by utilities.
While SolarCity shareholders appeared happy about the bid, Tesla shares dropped by 11 percent in after-hours trading, signaling that many investors did not like the idea of the company relinquishing 8 to 9 percent of its current market value to expand into the solar energy industry.
hg/jd (AP, dpa)
