Tesla Offers To Buy SolarCity In All-stock Deal

Tesla Motors Inc. announced Tuesday that it has made an offer to buy SolarCity Corp. , which would marry Elon Musk's biggest Silicon Valley startups. Musk is chief executive of Tesla, which makes electric cars and lithium-ion batteries, some of which are built for home usage with systems like the residential solar-power offerings of SolarCity. Musk serves as chairman for SolarCity, which was founded and is run by his cousins, Chief Executive Lyndon Rive and Chief Technical Officer Peter Rive. Tesla offered its own stock in the deal, which values SolarCity at $26.50 to $28.50 a share, according to a blog post from the company posted Tuesday afternoon. SolarCity stock closed at $21.19 Tuesday, but has sold for as much as $84.96 since going public in late 2012. SolarCity shares soared more than 20% in late trading Tuesday to more closely mirror the suggested price, topping $26; Tesla shares dropped more than 10% in after-hours action. Musk owns a 21.3% stake in Tesla and a 22.2% stake in SolarCity, according to FactSet data. The entrepreneur is also chief executive of SpaceX, which is based in Southern California.