Excerpt of article from Business Insider

Last week, Tesla announced that it was pursuing an acquisition of SolarCity, the troubled solar-panel leasing company that’s run by Tesla CEO Elon Musk’s cousin, Lyndon Rive.

And on Monday, SolarCity said that it formed a committee of independent directors to evaluate the deal.

That’s because Musk is the largest single shareholder of both companies, and is the Chairman of SolarCity.

Holy conflict of interest!

Actually, Musk and Rive have said that they will recuse themselves from voting on the deal.

Anyway, SolarCity is a $3-billion bite for Tesla, in an all-stock transaction that would add — brace yourself — over $3 billion in debt to Tesla’s balance sheet.

If this looks like a SolarCity bailout — the solar-panel leasing company has seen its market cap, now $2.25 billion, sawed in half since last year — that’s because it is.

The deal might looks outwardly vexing, and the post-announcement analysis has suggested that Tesla is doing something wrong here. It’s not though. It’s actually following through on promises Musk has made over and over again for the for the past half decade. If you’ve been paying attention, you could have seen this one coming, although you probably thought Tesla and SolarCity would become closer partners, not that Tesla would take charge.

So why is Tesla doing this?

It certainly doesn’t seem to be in order to enhance shareholder value. Tesla stock dived when the news broke.

What shareholder value?

But it’s never been clear that Tesla cares much about shareholder value.

Rather than please investors or vindicate the ratings and target prices of Wall Street analysts, the electric automaker is playing a longer game. The stock just helps it get there, by providing a way to raise capital, as it did recently and also last year, and to be used as a form of supercurrency to sustain Musk’s vision of a world freed from fossil-fuel dependency.


About the Author Chris Walker

Uniquely Australian, highly intuitive and inspired, Chris Walker is on the forefront of radical personal development and change that inspires people to find purpose and to live in harmony with the Laws of Nature. His methods are dynamic, and direct. His work is gifted, heart-opening and inspirational. The process Chris embraces can be confrontational, but if you are prepared to “step out” the personal power that this knowledge gives you is without doubt life changing and truly inspiring. Chris’s purpose is to open hearts and to stop the hurt. His work comes from his heart and is a truly magnificent gift for anyone ready to receive it. Chris shows people how to bring spirit into their life and keep it there. His sensitivity and empathy to others is his gift. The most powerful thing that we can do with our lives is to be on purpose, and live with the knowledge of spirit. Chris helps you discover this, that which is already yours, and through his work, you will find the courage and love to honour your-self and follow your heart. Chris brings his work to individuals and businesses. He believes for business success, you first need to create personal success, and this happens when your business and the people within it are on purpose. Chris Walker is an author, a speaker and a truly inspirational individual who has been fortunate enough in this life to find and live his truth.
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