SolarCity Corp (NASDAQ: SCTY) and Tesla Motors
Inc (NASDAQ: TSLA) reached a merger agreement over the
weekend, according to a regulatory
filing dated Sunday.
Tesla's CEO Elon Musk proposed to acquire SolarCity back in June. Musk also happens to be SolarCity's chairman and cousin to its
CEO Lyndon Rive.
Related Link: Musk Be Nice?
SolarCity Spikes 20% Amid Acquisition Offer From Tesla
The Wall Street
Journal confirmed that an all-stock agreement values SolarCity at around $2.6 billion, or $25.83 a share. SolarCity's
shareholders will receive 0.11 shares of Tesla's stock for each one share of SolarCity they own.
SolarCity's stock closed for trading on Friday at $26.70. During Monday's pre-market trading session, it was trading lower by
more than 5 percent at $25.16, representing a discount to the merger valuation.
However, the regulatory filing also calls for a 45-day "go-shop" period for SolarCity, after which a "no-shop" period will
follow.
SolarCity also issued preliminary second-quarter
operating metrics and an update to its full-year fiscal 2016 guidance. The company said that its total Megawatts (MW) installed
base for the second quarter totaled 201 MW and exceeded its prior guidance of 185 MW.
SolarCity also lowered its full-year fiscal 2016 guidance for MW installed to 900 to 1,000 MW from a prior range of 1,000 to
1,100 MW. The company attributed its downward revised outlook to lower than expected residential bookings activity throughout the
first half of the year that.
The closing of the merger is still subject to conditions.
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