Tesla buys SolarCity.
(Reuters) — SolarCity Corp agreed to be acquired by sister company Tesla Motors Inc in a deal worth $200 million less than the initial offer, sending shares of both companies down in early trading on Monday.
Electric vehicle maker Tesla expects to achieve “significant” cost savings and “dramatic improvements” in manufacturing efficiency as a result of the acquisition of solar panel installer SolarCity, Tesla Chief Executive Officer Elon Musk said on Monday.
Musk said the combined companies will have a “stronger balance sheet,” but likely will require a “small equity capital raise” next year. Both companies have been burning through cash and have projected achieving positive cash flow later this year.
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