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US: Tesla, SolarCity shareholders to vote on merger next month

By  |  October 12, 2016

Tesla Motors CEO Elon Musk faces a referendum next month, as shareholders decide whether to support his vision and combine Tesla with solar panel company SolarCity Corp.

Tesla and SolarCity announced Wednesday that shareholders will vote on the controversial proposal Nov. 17.

SolarCity shareholders will receive 0.11 share of Tesla for each SolarCity share. As of Oct. 10, the deal values SolarCity shares at $22.10, for a total value of $2.45 billion. Those values could change — the final terms will be determined by the value of Tesla shares on the day the merger goes into effect.

It’s a proposal that would unite two companies on shaky financial ground as they plow into relatively new markets. One makes electric cars, the other installs solar panels. Neither is profitable.

Last week, Goldman Sachs downgraded Palo Alto-based Tesla’s shares from “buy” to “neutral” and lowered its price target, saying the potential merger could delay the release of Tesla’s next vehicle, the Model 3. The car is due out at the end of next year.

Full Content: ABC News

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