Tesla and SolarCity unveil $5 billion merger
The solar energy technology company SolarCity announced Wednesday that it has signed a $5.5 billion deal to merge with the electric car maker Tesla.
The deal is one of the largest ever between the two companies, with $2.7 billion in total financing and the companies’ largest equity investment in a single transaction.
SolarCity Chief Executive Officer Lyndon Rive announced the deal, calling it a “game changer” for the solar industry.
“The combination of SolarCity and Tesla is a game changer for the automotive industry and our customers, and our shareholders,” Rive said in a statement.
“Together, we will accelerate the transition to sustainable, renewable energy, and help us meet the growing demand for electric vehicles.”
We believe this merger will bring together two of the most successful players in the automotive sector to deliver a stronger, safer, more sustainable and more affordable vehicle platform.
This will help our customers achieve the goals we all share for a cleaner, more efficient future.
“Tesla said it would invest $4 billion in the deal and will continue to invest heavily in the company’s infrastructure and product development.
The company said it will create a new division focused on electric vehicle manufacturing, which it called the Tesla Powerpack.
Solar City and Tesla had agreed in late 2016 to merge, but that deal fell apart after Tesla filed a lawsuit to prevent the merger, citing antitrust concerns.
Solar, based in Palo Alto, Calif., has been a leading player in the solar energy sector.
Tesla, based near San Jose, has been building its own solar energy business for years.
Tesla and Solar have been battling in recent years for control of solar panel makers, who control most of the panels.
Tesla has been trying to gain more control over panels made by SunPower and Advanced Micro Devices.