Elon Musk knew SolarCity was going broke before merger with Tesla, lawsuit alleges

  • 📰 latimes
  • ⏱ Reading Time:
  • 45 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 21%
  • Publisher: 82%

Malaysia News News

Malaysia Malaysia Latest News,Malaysia Malaysia Headlines

When Tesla bought SolarCity in 2016, Elon Musk billed the deal as a match made in green energy heaven. What he didn't mention: SolarCity was in deep financial trouble.

as a match made in green energy heaven: Combine a hot electric car company with the nation’s then-largest provider of solar rooftop panels to create a one-stop shop for clean energy customers.Just weeks after the merger, SolarCity auditor Ernst & Young concluded the company lacked “sufficient cash to meet its obligations” as a stand-alone company, according to court filings unsealed Monday.

In its motion, the plaintiff seeks summary judgment from the Delaware Chancery Court on key parts of the SolarCity case.Tesla issued a statement to The Times on Monday evening: “These allegations are based on the claims of plaintiff’s lawyers looking for a payday, and are not representative of our shareholders who support our mission and ultimately voted in favor of the acquisition.

In a further entanglement, another Musk company, the privately financed SpaceX, had loaned money to SolarCity to help keep the solar panel company’s cash position from dipping below $169 million, an event that would have triggered a bond default and possibly led to bankruptcy. By April, SolarCity board members heard from Rive and others that solar panel installations were expected to decline 28% for 2016, but the lawsuit alleges that the information never made its way to public investors.

 

Thank you for your comment. Your comment will be published after being reviewed.
Please try again later.

SolarCity was a public company then. Anyone could look at its financials and determine its health

They’d sell a lot more solar if they lowered the price 1/3rd. Every Tesla loses money. Why not do that with solar too? Everyone seems to think the subsidies will make my mind up but RETAIL solar costs $1 per watt. Why is it $2 with subsidies?

We have summarized this news so that you can read it quickly. If you are interested in the news, you can read the full text here. Read more:

 /  🏆 11. in MY

Malaysia Malaysia Latest News, Malaysia Malaysia Headlines