Elon Musk had the perfect response to the biggest criticism of the Tesla-SolarCity merger
Alex Wong/Getty Images
The deal is controversial, for three main reasons:
1. Elon Musk owns about 20% of both companies, and it CEO of Tesla and Chairman of SolarCity
2. SolarCity's financials this year have been a wreck: the company has lost 50% of its market cap, so this looks like a bailout
3. Tesla already has a lot of contend with this year in its car business - and it doesn't really need to be adding SolarCity's $3 billion debt to the the balance sheet
Of these, the first has been explicitly addressed by Musk, who has recused himself from voting on the deal. On a call with analysts on Monday, he joked that if a better offer came through, he'd have to go along with it, taking Tesla out of the running for the acquisition.
But he also addressed the conflict-of-interest issue.
"The conflicts of interest," he said, in response to an analyst's question, "are if we don't merge."
That's actually a good point. Musk said in his recently published "Master Plan, Part Deux" for Tesla that the car maker and SolarCity should have been under the same roof all along. And if Tesla were to bind itself up with SolarCity's business without merging, then it would appear as if Musk were using one company to prop up the other.
Musk seemed baffled and somewhat amused that observers haven't yet figured this out.
- US buys 81 Soviet-era combat aircraft from Russia's ally costing on average less than $20,000 each, report says
- 2 states where home prices are falling because there are too many houses and not enough buyers
- A couple accidentally shipped their cat in an Amazon return package. It arrived safely 6 days later, hundreds of miles away.
- Why did a NASA spacecraft suddenly start talking gibberish after more than 45 years of operation? What fixed it?
- ICICI Bank shares climb nearly 5% after Q4 earnings; mcap soars by ₹36,555.4 crore
- Markets rebound sharply on buying in bank stocks firm global trends
- Bengaluru's rental income highest in Q1-2024, Mumbai next: Anarock report
- Rupee falls 10 paise to settle at 83.48 against US dollar
- Nothing Phone (2a) blue edition launched
- JNK India IPO allotment date
- JioCinema New Plans
- Realme Narzo 70 Launched
- Apple Let Loose event
- Elon Musk Apology
- RIL cash flows
- Charlie Munger
- Feedbank IPO allotment
- Tata IPO allotment
- Most generous retirement plans
- Broadcom lays off
- Cibil Score vs Cibil Report
- Birla and Bajaj in top Richest
- Nestle Sept 2023 report
- India Equity Market