Only ten days left until the shareholders’ vote on Tesla’s acquisition of SolarCity.

Only ten days left for the shareholders’ vote on Tesla’s acquisition of SolarCity, but Musk remains confident, making it seem like the vote is just a formality. Xiao Dian plans to summarize the beginning and key events of the merger for everyone.

1 Invitation to Acquire

On June 22 (US time), Tesla invited SolarCity to a stock acquisition worth approximately USD 2.6 billion to USD 2.8 billion, with an estimated valuation of USD 26.5 to USD 28.5 per share of common stock for SolarCity.

Tesla planned to acquire SolarCity by issuing new Tesla shares to SolarCity shareholders, with an exchange ratio of 0.122x to 0.131x Tesla common shares for 1 share of SolarCity common stock.

If the acquisition is successful, Tesla will become the world’s first vertically integrated energy company, able to provide customers with a complete clean energy solution from clean car usage to car charging and household and business clean energy usage, truly realizing the company mission of “accelerating the world’s transition to sustainable energy.”

The immediate reaction to the news was a drop in Tesla’s share price and media criticism. Some people accused Musk of giving SolarCity a blood transfusion by any means necessary, while others thought that Musk no longer had the magical ability of turning stone into gold like he did in the past and had to resort to the vulgar tactics of acquisition and expansion.

But some media outlets fought back with the idea that “those opponents are people who cannot hold Tesla and SolarCity stocks, and the real shareholders support the acquisition”, and conducted a survey, revealing that 73.5% of Tesla shareholders and 93% of SolarCity shareholders support the acquisition out of 2211 Tesla shareholders. This is probably Musk’s confidence in giving up his voting rights as a major shareholder, as he believes that the acquisition of SolarCity is so obvious that it doesn’t even need to be questioned. From the first day of the acquisition announcement, Musk’s attitude has been very optimistic and firm, and he has stated that the major shareholders of Tesla also fully support the acquisition plan.2 Agreement on Merger Reached

On August 1st, Tesla announced an agreement to acquire Solarcity for $2.6 billion, with Solarcity having a 45-day bidding period during which it has the right to accept other buyers’ bids.

According to Tesla’s statement, Tesla is preparing to mass-produce its energy storage system, Powerwall, and Powerpack, while Solarcity is preparing to launch differentiated solar solutions. After integration, the two complement each other in their goals, enabling more efficient and integrated operations to provide customers with aesthetically pleasing, one-stop solar product use experience: a set of devices, a usage agreement, and an APP. Additionally, Tesla mentioned some corporate development visions, as well as the benefits of the merger for customers, such as reduced cost of energy storage device installation and more.

On August 17th, there was a small interesting episode where Solarcity announced a restructuring and CEO and CTO Rivo Brothers voluntarily gave up their annual salary, receiving only a symbolic $1 per year, and on Tesla’s side, Musk also accepted a $1 per year salary. It seems that these three brothers also have a lot of determination for the merger plan. (Musk’s cousin is the founder of Solarcity, and the three have a very close relationship. Musk was very excited to invest when he found out that his cousin had started such a company when he was not yet well-known.)

3 Joint Release of Solar Energy Products

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**After two months of announcing the partnership agreement, Solarcity underwent a series of personnel adjustments and financial restructuring, while Tesla had to deal with some lawsuits filed by dissatisfied shareholders regarding the acquisition. The two sides announced a shareholder voting conference scheduled for November 17th, at which the acquisition will be determined by the vote. On the 28th, Musk introduced the solar roof jointly developed by Tesla and Solarcity at a press conference. The true face of the solar roof, which everyone had been speculating about, was finally revealed. As Musk said earlier, “It is a roof with solar capabilities, not a solar panel on the roof!” The solar roof is made up of solar tiles that look no different from regular tiles, but have the function of solar energy storage, providing power support for the house. On that day, Musk also introduced the newly released home energy storage device, Powerwall 2.0, and outlined a new vision of future renewable energy life: a set of reserve equipment, a solar-powered house and a Tesla electric car.

Looking at the planning of the solar tile product, Tesla’s advantage in energy storage equipment and Solarcity’s operating model seem to have been a long-term plan.

However, when we see the solar tiles, we are reminded of a recent news story in which an American couple, Scott Brusaw and Julie Brusaw, built a road paved with solar panels that can provide immediate charging services for cars driven on it.

With the achievement of its first profitable third-quarter performance and the impressive solar tile product, Musk has gained increasing support for his victory in the shareholder voting conference.

As a side note, I believe that Musk’s entrepreneurship in electric vehicles, rockets, and solar projects are essentially different parts of a big picture, with solar plans being the fundamental pursuit of his “changing human life” goal. As mentioned in our news flash last week, a solar-powered house, energy storage device, and a Tesla car are Musk’s “Plan B,” and Solarcity’s operating model is the key to Plan B’s global promotion.