1. Tesla Model 3 apparel now available!


    Dismiss Notice

Breaking: Tesla Makes an Offer to Acquire SolarCity [Live updates]

Discussion in 'News from Electrek.co' started by RSSFeed, Jun 21, 2016.

More threads by RSSFeed
  1. RSSFeed

    M3OC RSS Bot
    Expand Collapse

    Joined:
    Sep 28, 2016
    Messages:
    2,597
    Likes Received:
    189
    Trophy Points:
    63
    [​IMG]

    Tesla announced that it plans to acquire its sister company, SolarCity. Tesla CEO Elon Musk will hold a press call shortly. We will update with more information soon. Below you will find the announcement released by Tesla and Lyndon Rive’s, SolarCity’s CEO and Elon Musk’s cousin, letter to the board with the offer to buy the shares for $26.50 to $28.50 – a premium of approximately 21% to 30% over the closing price of SolarCity’s shares. more…

    Filed under: Cars, SolarCity, Tesla Tagged: SolarCity, Tesla, tesla solarcity [​IMG] [​IMG] [​IMG] [​IMG] [​IMG] [​IMG] [​IMG] [​IMG][​IMG]

    Continue reading...
     
  2. TE3LA

    Active Member
    Expand Collapse

    Joined:
    Apr 3, 2016
    Messages:
    152
    Likes Received:
    95
    Trophy Points:
    28
    Gender:
    Male
    City & State/Province:
    Iowa
    Country:
    Country
  3. TrevP

    M3OC Founder / Administrator
    Staff Member Founder
    Expand Collapse

    Joined:
    Mar 1, 2016
    Messages:
    2,909
    Likes Received:
    2,175
    Trophy Points:
    113
    Gender:
    Male
    City & State/Province:
    Aurora,Ontario
    Country:
    Country
  4. garsh

    Dis Member
    Moderator
    Expand Collapse

    Joined:
    Apr 4, 2016
    Messages:
    1,715
    Likes Received:
    954
    Trophy Points:
    113
    Gender:
    Male
    City & State/Province:
    Pittsburgh PA
    Country:
    Country
    As expected, TSLA is taking a hit.
    Time to buy a few more shares. :cool:
     
  5. Steve

    Active Member
    Expand Collapse

    Joined:
    Apr 14, 2016
    Messages:
    51
    Likes Received:
    39
    Trophy Points:
    18
    Gender:
    Male
    City & State/Province:
    Modesto, CA
    I am currently awaiting approval from my local electrical supplier, (hopefully any day now) to install my SolarCity system. Should be good news to be directly tied to Tesla.
     
  6. John

    Tech CEO
    Expand Collapse

    Joined:
    Apr 15, 2016
    Messages:
    266
    Likes Received:
    144
    Trophy Points:
    43
    Gender:
    Male
    City & State/Province:
    California
    Country:
    Country
    Does this give TSLA any regulatory approvals to sell kW?
     
  7. Andreas Stephens

    Active Member
    Expand Collapse

    Joined:
    Apr 4, 2016
    Messages:
    47
    Likes Received:
    25
    Trophy Points:
    8
    Gender:
    Male
    City & State/Province:
    Sydney Australia
    Rational me is against this deal for a whole range of reasons - the list would not fit on the screen you are reading.

    As a Tesla Motors shareholder, besides having to absorb an immediate and material drop in the share price of my investment, I believe it inevitably results in lower focus on Tesla operations by Tesla management than if it remained a stand-alone business. Instead of giving their undivided attention to creating the first large-scale electric car manufacturer and developing associated battery technology (no-small-feat-in-itself!), management will now also have to find the time to manage the loss making solar business. Instead of talking to bankers on how to fund new car factories in other parts of the world, Tesla management would now have to also seek funding for growing the solar business. Instead of discussing the progress of their car manufacturing operations, future investor discussions might get side-tracked by SolarCity not meeting quarterly sales targets (see its last reported result). Instead of negotiating with car part suppliers, management now also have to negotiate with solar cell part suppliers. The list goes on and on...

    "But existing Solar City management will look after those operations" I hear you say... Well, yes - but no. Either you integrate the two businesses or you don't. If you do integrate, it will be Tesla management time and focus that will be spent. If you don't integrate, then you don't get the synergies, so what is the point?

    Anyway, as an Elon Musk fan I know why he is doing what he is doing and what he is doing is GOOD. Most importantly, for the sake of our children, he must succeed! So, for the same reason that I waited for two days to register for my Model 3, I will get up in the middle of the night to buy some more Tesla shares.

    I have both religion and faith!

    PS: This is not investment advice, just rambling thoughts of an old punter! Also, I ought to disclose that in my youth I did a PhD on Solar Cells. I am all for PV solar and I recently invested in a Community Solar Project in preparation for my Model 3. Do not interpret my above comments as anti-SolarCity. My only - but very real - concern is about the lack of focus the proposed deal would lead to - something that has led to me observing many a company flounder and fail.
     
  8. Curtish8892

    Active Member
    Expand Collapse

    Joined:
    Apr 24, 2016
    Messages:
    41
    Likes Received:
    8
    Trophy Points:
    8
    Gender:
    Male
    City & State/Province:
    Toronto, Canada
    I spoke to an acquaintance that works at a solar installation company here in Toronto. He advised my to wait, he stated that there will be changes happening to the industry that will benefit the consumer. I guess this is one of the possible changes.

    Apple made the computers/phones and the software.

    Tesla makes the electric cars and the electricity.

    If this helps the world move closer to a sustainable future then I am a staunch supporter.

    Better to burn out than fade away!!
    Musk you are the man!!
     
  9. MelindaV

    ☰ > 3
    Moderator
    Expand Collapse

    Joined:
    Apr 2, 2016
    Messages:
    2,072
    Likes Received:
    1,381
    Trophy Points:
    113
    Gender:
    Female
    City & State/Province:
    Vancouver, WA
    Country:
    Country
    Here's another totally anecdotal spin.... Tesla bidding to take over SCTY could potentially open it up to other takeover offers.

    Speaking from being an employee of a publicly traded company, with the founder as the CEO. Said founder decided he was tired of being limited by the market, so put in an offer to buy back the company. This then spurred their largest competitor to put in a counter offer. Then a much smaller competitor put in an offer. because of the FTC rules on monopolies, the smaller competitor ended up 'winning'. Turned out, both the buying costs and upkeep of a much larger company then their own original company ended up to be too much for them to handle. Within 2 years they were out of business. I got out sometime after the takeover and before the end. don't know how it would have all panned out if the CEO had been successful at the buyout, but am sure it would have gone much better. 10+ years later and it still irks me.
     
  10. TrevP

    M3OC Founder / Administrator
    Staff Member Founder
    Expand Collapse

    Joined:
    Mar 1, 2016
    Messages:
    2,909
    Likes Received:
    2,175
    Trophy Points:
    113
    Gender:
    Male
    City & State/Province:
    Aurora,Ontario
    Country:
    Country
    I have a close friend who moved to CA and works for Solar City and said they had plans to eventually expand to Canada. Hasn't happened yet but given our new focus on "green energy" I hope prices come down to the point where even a small installation for our townhouse would be doable.
     
  11. AEDennis

    Top-Contributor
    Expand Collapse

    Joined:
    Apr 10, 2016
    Messages:
    673
    Likes Received:
    354
    Trophy Points:
    63
    City & State/Province:
    Southern California, Most of the time...
    Country:
    Country
    As a TSLA shareholder and (consciously) not a SCTY stock holder, I am against and aghast at this decision by TSLA.

    There are already large challenges in getting the Gigafactory running. Model 3 deliveries next year... As an owner of TSLA stock, and two Tesla cars, I am worried that this move is beneficial for SCTY but not TSLA. TSLA already had benefits of being a partner of SCTY and OTHER solar companies. This move alienates these other partners.

    Furthermore, I want a Tesla to succeed... I am a big fan of solar, just not as an investment, right now.

    Tesla stock had moved to the negative in after hours trading because this move currently does not make sense. SCTY has a lot of headwinds and its credit worthiness will be a drag on all of TSLA.
     
    • Agree Agree x 2
    • MelindaV

      ☰ > 3
      Moderator
      Expand Collapse

      Joined:
      Apr 2, 2016
      Messages:
      2,072
      Likes Received:
      1,381
      Trophy Points:
      113
      Gender:
      Female
      City & State/Province:
      Vancouver, WA
      Country:
      Country
      having a token amount of both TSLA and SCTY I expected a much more drastic price change within the first hour. Even with the $20 drop on TSLA, last night I expected it would be closer to a $30+ hit this morning. obviously we shall see what happens the rest of the day, or over the next month, especially if the deal goes thru.
       
    • Topher

      Top-Contributor
      Expand Collapse

      Joined:
      May 11, 2016
      Messages:
      450
      Likes Received:
      149
      Trophy Points:
      43
      City & State/Province:
      Maine
      Country:
      Country
      If we assume that no one is getting fired, then all the current management will be doing what that they were already doing. The synergies come from talking to each other.

      Thank you kindly.
       
    • TE3LA

      Active Member
      Expand Collapse

      Joined:
      Apr 3, 2016
      Messages:
      152
      Likes Received:
      95
      Trophy Points:
      28
      Gender:
      Male
      City & State/Province:
      Iowa
      Country:
      Country
      I don't see how this deal get past the short-term Tesla stock-holders. With Elon recusing himself from the vote, even if he can convince the folks who are long on TSLA that this is good idea for the future of the company, there are a hell of a lot of investors who are in TSLA to make some $ in the short to near term. These folks are already looking at this deal as a 8.3% hit in their investment (as of time of writing). They may see tanking this deal as the only way to possibly get this $ back in a relatively short period of time.
       
    • garsh

      Dis Member
      Moderator
      Expand Collapse

      Joined:
      Apr 4, 2016
      Messages:
      1,715
      Likes Received:
      954
      Trophy Points:
      113
      Gender:
      Male
      City & State/Province:
      Pittsburgh PA
      Country:
      Country
      Will stockholders even have a say?
       
    • TE3LA

      Active Member
      Expand Collapse

      Joined:
      Apr 3, 2016
      Messages:
      152
      Likes Received:
      95
      Trophy Points:
      28
      Gender:
      Male
      City & State/Province:
      Iowa
      Country:
      Country
      • Informative Informative x 1
      • TE3LA

        Active Member
        Expand Collapse

        Joined:
        Apr 3, 2016
        Messages:
        152
        Likes Received:
        95
        Trophy Points:
        28
        Gender:
        Male
        City & State/Province:
        Iowa
        Country:
        Country
        I just finished listening to the conference call, and this point was also raised by a couple of the questioners. Elon and Co. didn't have much of a response, other than to say this is in the early stage of the process and that a more detailed financial picture will be provided after the due diligence period, and that it will become clear that its the right thing to do. The only reason they are making the announcement of the acquisition offer prior to the due diligence period is because of the unusual ethical issues involved with Elon's ownership stake in both companies. This puts Tesla in an awkward position of making the announcement before the deal is done, so we all get to see how the sausage is made.

        Elon admitted that in the hours following the initial announcement he got positive feedback from "product focused" investors who saw this as the right direction for the company, but concerns from "finance focused" investors who were a lot more worried. Elon argued that the valuation of a company should ultimately be product-focused; i.e. if you make make an excellent product, the money will follow [read Apple], and that this acquisition will guarantee a better overall product. But that argument still doesn't address the short-term investor problem. There were apparently no discussions with large TSLA stakeholders prior to the announcement to gauge their willingness to go along with the deal.

        I still think this deal will live or die on Elon being able to convince 51% of the remaining shareholders to be long on TSLA. This is a long-haul for investors who got into Tesla thinking it was just a revolutionary car company. You can forget about the whole Tesla "master-plan" of Roadster (high-end sport), Model S (luxury sedan), Model 3 (affordable car for the masses). With this acquisition proposal, Elon has basically revealed a new master-plan to bring Telsa closer to its core mission statement: "Tesla's mission is to accelerate the world's transition to sustainable energy". In his typical bold [hubris?] style, Elon said he thinks that as a broader sustainable energy company, Telsa can reach a trillion dollar market cap (oh, and save the world). He might just be right, but he's got a lot more convincing to do.
         
      • AEDennis

        Top-Contributor
        Expand Collapse

        Joined:
        Apr 10, 2016
        Messages:
        673
        Likes Received:
        354
        Trophy Points:
        63
        City & State/Province:
        Southern California, Most of the time...
        Country:
        Country
        ...Actually I believe it's 2/3rd majority that needs to be convinced and not a simple majority. Of course the question is what happens and what ratio is needed when Elon and another shareholder of both companies recused themselves on the vote.
         
      • TrevP

        M3OC Founder / Administrator
        Staff Member Founder
        Expand Collapse

        Joined:
        Mar 1, 2016
        Messages:
        2,909
        Likes Received:
        2,175
        Trophy Points:
        113
        Gender:
        Male
        City & State/Province:
        Aurora,Ontario
        Country:
        Country
        He's absolutely right: from a product perspective it makes total sense, from a financial one it's worrisome. I'm long on TSLA but at the moment I really wish they'd focus their attention on their current products and get Model 3 production going and wait 2 or 3 years for strong profits to roll in. Sure, it's stock swap so no cash outlay but they're still burning cash and Solar City is not exactly rolling in dough at the moment.

        I say no for now and let's revisit it in 3 years.
         
        • Agree Agree x 2
        • TE3LA

          Active Member
          Expand Collapse

          Joined:
          Apr 3, 2016
          Messages:
          152
          Likes Received:
          95
          Trophy Points:
          28
          Gender:
          Male
          City & State/Province:
          Iowa
          Country:
          Country

        Share This Page

        Model 3 Owners Club © 2017. All rights reserved.
        Model 3 Owners Club (M3OC) is an enthusiast club and is not affiliated with Tesla Motors or the Tesla Motors Club Forum (TMC).
        All Tesla logos are trademarks or registered trademarks of Tesla Motors.