Plans for Elon Musks Tesla Motors to acquire the largest distributed solar installer in the United States are moving forward quickly, but still have not been approved by shareholders of both companies. As the latest, on Sunday Tesla and SolarCity entered into a merger agreement, which was approved by the Tesla board.
Under the plan, SolarCity shareholders will be able to receive 1 share of Tesla Motors stock for every 9.1 shares of SolarCity stock that they hold at the time the acquisition closes. Additionally, SolarCity options and restricted stock unit awards will be converted into corresponding equity awards in respect of Tesla common stock based on the exchange ratio.
This would value SolarCity at around $2.6 billion, according to calculations by Wall Street Journal.
In order for the acquisition to move forward, stockholders of both SolarCity and Tesla must still vote on the plan. Elon Musk and other named executive of both companies, including his cousins Lyndon and Peter Rive, which run SolarCity, have recused themselves from these votes. A date has not been specified in documents filed with financial regulators.
While the deal has been criticized in the press and Tesla shares initially fell on the announcement, they are more valuable now than they were before plans for the acquisition were unveiled ten days ago. SolarCity shares have remained relatively unchanged.
In addition to the plan of merger, SolarCity has released selected preliminary operational results for the second quarter, which show an increase in capacity installed to 201 MW, above guidance of 185 MW.
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