Tesla, the electric car company of which Elon Musk is chairman, chief executive, and the largest shareholder (with a 26.5% stake), has just made an offer to acquire SolarCity, the clean energy company of which Elon Musk is chairman and the largest shareholder (with a 22.2% stake.)
The stock deal values SolarCity at up to $2.8 billion, or between $26.50 and $28.50 per share. That’s a premium of about 20% to 30% over SolarCity’s Tuesday closing price of $21.19.
Here are some of Elon Musk’s other entanglements with SolarCity:
- Peter Rive, SolarCity’s co-founder and chief technology officer, is Lyndon Rive’s brother and another Musk first cousin. He owns 295,348 SolarCity shares.
- In April, Musk’s rocket company, SpaceX, purchased $90 million in solar-backed bonds from SolarCity.
- Those bonds, according to Musk, were an “excellent investment.”
- Last year, SpaceX spent $165 million on bonds issued by SolarCity.
- Musk has taken out $475 million in personal credit lines to pump money into SolarCity and Tesla through share purchases.
- He secured those credit lines with about $2.5 billion in shares of SolarCity and Tesla.
- SolarCity is building a giant solar field on 50 acres of land in Hawaii. It is buying the batteries for that project from Tesla.
Musk said on a conference call following the announcement that he is recusing himself from the vote on the Tesla-SolarCity merger.
“Of course, the shareholders will make the final decision,” Lyndon Rive said.
“This would only move forward if there’s a majority vote of the non-me shareholders in the company,” Musk added.
Shares of SolarCity jumped 17% in after-hours trading. Shares of Tesla slid 11%.