Musk expects supermajority support for Tesla-SolarCity merger – report

Jul 25, 2016 11:23 CEST by Ivan Shumkov

July 25 – Elon Musk, the largest shareholder in both Tesla Motors Inc (NASDAQ:TSLA) and SolarCity (NASDAQ:SCTY), expects the proposed merger of the two companies to be backed by a supermajority of stockholders.

In an interview with the Wall Street Journal (WSJ), Musk said the most informed shareholders are “highly supportive” of the planned combination. Opposition, on the other hand, comes from those who do not understand the advantages of bringing together the Tesla electric vehicles and solar roofs.

A day after the interview, Musk posted a new master plan for Tesla in which he points at the creation of a solar-roof-with-battery product “that just works”. The goal is to simplify the ordering experience for customers, to implement a single installation under one service contract and to allow the client to manage the systems via one phone app.

“We can’t do this well if Tesla and SolarCity are different companies, which is why we need to combine and break down the barriers inherent to being separate companies,” he says.

In June, Tesla’s board proposed to acquire all of SolarCity in exchange for Tesla stock.

Since then, Musk has been discussing the plan with Tesla’s largest investors, including Fidelity Investments. He expects that the transaction will be backed by a two-thirds majority, even though it needs less than that to go through, the WSJ said.

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