Tesla to buy Solar City, Musk businesses holding company next?

[DocM]

Musk may be evolving a holding company as an umbrella for his businesses, similar to when Google formed Alphabet. 

 

If so, first it'll be Tesla, Tesla Energy and Solar City, but there's also SpaceX and whatever they'll call their 4000+ satellite orbital internet backbone (CommX has been a placeholder.)

 

Perhaps later one of the Hyperloop companies, and spin off the Seattle satellite & electric space propulsion unit later.

 

http://electrek.co/2016/06/22/elon-musk-thinking-parent-company-spacex-tesla-solarcity/

 

Quote

Elon Musk has been thinking about consolidating his companies for a while, SpaceX could be next

 

Yesterday, Elon Musk surprised a lot of people when he announced that Tesla (TSLA) has made an offer to acquire SolarCity (SCTY). The entrepreneur is the largest individual shareholder of both companies – he owns about 27% of Tesla and 22% of SolarCity.

Some Tesla shareholders are already calling the deal a “bailout” of SolarCity, especially after Musk bought another $10 million worth of shares last year – before the stock fell 60% in 2016. The deal would allow him to convert his shares of SolarCity to Tesla shares at a favorable rate, but we now learn that the move might not be reactionary and actually long in the making.

A reader pointed us to an obscure comment made by Elon years ago about creating a holding corporation for his companies. In an online Q&A back in 2012, Musk answered a question about the movement of capital between Tesla and SpaceX:

“They are separate corporations, so capital cannot be moved between them. Am starting to consider whether it would make sense to create a parent corporation that would own the stock, which would make that easier. Not sure if that is feasible or sensible, but am thinking about it.”

While not directly related to the Tesla – SolarCity deal, it shows that Musk has been thinking about consolidating his companies for a while. Here he is talking more about what Larry Page did with Google, which is now part of Alphabet – a holding company with Google and other divisions operating as separate companies.
>

 

 

[Draggendrop Veteran]

This would allow leverage for one of the ventures to receive parent funding when needed...a very good idea, in my opinion.