Until now, Tesla customers could drive clean cars and use battery packs to consume energy more efficiently, “but they still needed access to the most sustainable energy source that’s available: the sun,” according to a Tesla statement. Tesla hopes to guarantee its customers access to solar energy by acquiring SolarCity, a US company that designs, finances and installs solar power systems. It is also active in developing energy storage systems.
If the acquisition goes through, Tesla would become the first vertically integrated energy company in the world to offer end-to-end clean energy products. It believes that such a move would benefit customers of both Tesla and SolarCity alike by allowing them to purchase their electric vehicle, solar panel system and home battery system from one source. The acquisition would also build on the core competencies of each company: Tesla’s design, engineering and manufacturing skills and SolarCity’s sales and distribution channels and strategies.
Tesla’s offer represents a value of USD 26.50 to USD 28.50 per share, or a premium of around 21 per cent to 30 per cent over the closing price of SolarCity’s shares. According to the Wall Street Journal, this amounts to a purchase price of USD 2.8 billion. Musk co-founded SolarCity but has not been involved in its day-to-day operations.