Tesla’s Offer to Buy SolarCity Puzzles Wall Street

Tesla’s Offer to Buy SolarCity Puzzles Wall Street
FILE - In this June 22, 2012 file photo, Tesla CEO Elon Musk waves during a rally at the Tesla factory in Fremont, Calif. Tesla Motors has selected Nevada for a massive, $5 billion factory that it will build to pump out batteries for a new generation of electric cars, a person familiar with the company's plans said Wednesday, Sept. 3, 2014. AP Photo/Paul Sakuma, File
Emel Akan
Emel Akan
Reporter
|Updated:

Electric carmaker Tesla Motors wants to acquire SolarCity to merge products of two clean energy companies owned by Elon Musk. While Musk says the deal is a “no-brainer,” the news caused Tesla shares to tumble.

Tesla Motors Inc. (TSLA:NASDAQ) said on June 21 it offered to buy SolarCity Corp. (SCTY:NASDAQ) in an all-stock deal, which valued the solar energy company at as much as $2.8 billion. Elon Musk is the chairman and largest shareholder of both companies.

The market has reacted to the announcement, and Tesla’s shares dropped nearly 10 percent and took more than $3 billion off its market value.

Tesla (TSLA:NASDAQ) share price performance, last one month. (YCharts)
Tesla (TSLA:NASDAQ) share price performance, last one month. YCharts
Emel Akan
Emel Akan
Reporter
Emel Akan is a senior White House correspondent for The Epoch Times, where she covers the policies of the Trump administration. Previously, she reported on the Biden administration and the first term of President Trump. Before her journalism career, she worked in investment banking at JPMorgan. She holds an MBA from Georgetown University.
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