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Elon Musk Sets a Surprising Takeover Price of $2.6 Billion for SolarCity

10 Aug, 16 News,

Tesla’s new move to acquire SolarCity is regarded by industry experts as Elon Musk’s (Tesla Owner) clean energy move. This is an extremely high priced deal with a proposed price tag of $2.6 billion. Tesla Motors is reportedly revamping its energy drives. This is a long overdue deal as Musk serves as Chairman of the SolarCity Board and had made his intention public a month back. This alliance is regarded as part of a bigger plan that would make Tesla vehicles stand out from its competitors in its grand energy saving model.

Elon Musk wants to combine the two organizations to bring out a wide range of low-volume/high-cost and low-cost/high-volume vehicles that would efficiently handle energy generation and storage. Both the companies have their individual clean energy initiatives and this current deal would take them to a different level.

Tesla Powerwall and SolarCity brought together would serve a bigger purpose as explained by Musk himself, “That they are separate at all, despite similar origins and pursuit of the same overarching goal of sustainable energy, is largely an accident of history. Now that Tesla is ready to scale Powerwall and SolarCity is ready to provide highly differentiated solar, the time has come to bring them together.”

The deal has been approved by the board members and is expected to save the company $150M in “cost synergies.” However there are still areas to work on as SolarCity has 45 days to find a better deal and the deal requires a regulatory approval. Elon being the chairman for both the companies and his cousins running SolarCity saves the deal all the hassle of other companies coming into the picture.