The Tesla Motors Inc. shareholders and SolarCity Inc. approved Tesla's $2.1 billion all stock offer to merge and create a company that would emissions-free cars and roof-top solar panels that power them. The company will headed by Elon Musk.
"Your faith will be rewarded," Mr. Musk told Tesla investors on Thursday after the company announced shareholders overwhelmingly approved the deal.
Tesla announced that the merger was approved by 85% of Tesla shareholders, excluding Mr. Musk and other affiliated shareholders. SolarCity didn't disclose the percentage of its shareholders voting.
Earlier this month, Tesla shared the reasons a SolarCity merger makes sense for both the companies. Tesla cites $150 million worth of "direct cost synergies" that will be realised in the merger with the SolarCity, through sales and marketing effeciencies and "corporate overhead savings."
The combined company will target home-owners in a bid to sell all electric vehicles, solar panels and batteries, enabling customers to power their cars and home with clean energy.
According to Wall Street Journal, its been since June that Mr.Musk first proposed the merger, he had campaigned with typical showmanship to persuade shareholders in both companies to support and go ahead with the plan.
As per the reports from CNBC, the merger has somewhat divided investors and analysts opinions. Some Tesla shareholders have actually filed lawsuits against the deal and critics are suggesting as a bail out moment for the SolarCity.
The merger comes as the solar energy business is showing initial signs of a slowdown.
GTM research's Global Solar Demand Motor forecasts and came up with the result that solar industries will keep contracting at a speed of 7 percent per year.
But Institutional Shareholder Services recommended the investors vote in favor of the deal. The influential firm said that "necessary step of Tesla's goal being an integrated sustainable solar energy company."
Tesla said it expects the SolarCity to add more than half a billion dollars in cash to Tesla's balance sheet over the next 3 years.
