We don't know how these crazy kids got it together so fast [ed note: we do], but it seems like the SolarCity Tesla merger is pretty much a done deal...
Tesla Motors Inc expects to achieve "significant" cost savings and "dramatic improvements" in manufacturing efficiency as a result of its planned $2.6 billion acquisition of solar panel installer SolarCity Corp, Tesla Chief Executive Officer Elon Musk said on Monday.
Oh yeah! We love deals, and this one looks to be pretty big. Elon is obvs psyched, becasue after all, he knows what he's getting...
Musk said the combined companies will have a "stronger balance sheet," but likely will require a "small equity capital raise" next year. Both companies have been burning through cash and have projected achieving positive cash flow later this year.
Musk is the largest shareholder in both companies and is chairman of SolarCity. His cousins Lyndon Rive and Peter Rive are co-founders of SolarCity.
But Elon isn't just moving his pieces around his board willy-nilly. After all, he's the modern Great Gatsby so you know he's playing the long game, and this merger is all part of his new "Master Plan" to cement his clean energy empire and provide electric cars and solar power to everyone who wants it.
Some people who might not want this deal though are SolarCity shareholders...
The companies said on Monday that SolarCity stockholders would receive 0.110 Tesla common shares for every share held.
The offer values SolarCity at $25.37 per share, based on the five-day volume-weighted average price of Tesla shares as of Friday.
SolarCity had formed a special committee to review Tesla's initial offer, which was pitched at 0.122 to 0.131 Tesla shares for each SolarCity share.
That's not going to set any hearts afire, especially now that shareholders will get to watch Elon grab up as much capital as he can find before shoveling into the gaping maw of his always-starving business engine.
Now, there are a few potential hiccups before Elon comes to final terms with Elon. Like this:
The deal includes a "go-shop" provision that allows SolarCity to solicit offers from other potential buyers for 45 days through Sept. 14.
You hear that, SpaceX? 45 days.