Elon Musk failed to disclose his purchase of SolarCity stock.

Musk bought 570,000 shares of SolarCity stock on February 11, evidently near the time he discussed the possibility of a merger with cousin Lyndon Rive.

The per-share purchase price ($17.56) was significantly below the implied valuation of SolarCity stock in the merger; hence, Musk will realize a profit of several million dollars if the merger is approved.

Again, EnerTuition’s article has an excellent and nuanced discussion of the stock purchase, and the questions it raises, so I skip over it here except to note Musk’s stock purchase further taints a deal that already has a bad odor.


If you are a Tesla shareholder (or, indeed, a SolarCity shareholder), and deciding how to vote on the merger, would any of these topics be important?

  • A budget for CapEx needed to achieve volume production of the Model 3;
  • Any change in 2016 delivery guidance;
  • Any change in the number of Model 3 deposits since April;
  • The yield on Tesla’s 32,000 Model X deposits;
  • Details about Model S order backlog and demand;
  • Details about Tesla Energy sales;
  • Details about Tesla Energy margins;
  • Details about Gigafactory sub-suppliers;
  • Details about the “safety stock” Panasonic is requiring Tesla to pay for;
  • Update on whether Tesla still plans to begin Model 3 production in July 2017;
  • Update on whether Tesla still forecasts production of at least 100,000 Model 3 car in 2017.

If you believe any of this information might be useful in considering the merger proposal, too bad for you. The S-4 is silent about all this.

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