Tesla CEO Elon Musk. Christophe Gateau: picture alliance via Getty Images Elon Musk is defending Tesla’s 2016 acquisition of SolarCity in court.
SolarCity was founded by Musk’s cousins, and some shareholders say the acquisition was a bailout.
Once the top installer of solar panels in the US, SolarCity was turned into Tesla Energy.
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Five years ago Tesla bought SolarCity, the biggest installer of residential solar panels in the US. Tesla CEO Elon is now having to defend that decision against shareholders, who claim the acquisition amounted to a bailout.
If Musk loses, he’ll be liable to pay up to $2.6 billion back to Tesla. Although this would make up only a fraction of Musk’s fortune — at time of writing his net worth stands at $179 billion per the Bloomberg Billionaires Index — Wedbush analyst Dan Ives said the case is a “black eye” for Tesla and could do serious reputational damage.
The case hinges on whether Musk exerted undue influence over Tesla’s board, and whether he misrepresented SolarCity’s financial health. Originally, the suit targeted the whole Tesla board as well as Musk, but the other board members agreed to an out-of-court settlement for $60 million in January 2020 .Musk’s appearances in the witness box this week were characteristically bombastic, with the Tesla CEO throwing personal insults at the plaintiffs’ lawyer and claiming his sense of humor drives sales . As part of his defense, Musk said the acquisition of SolarCity was part […]
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