Dive Brief:
- Oppenheimer analyst Colin Rusch believes Tesla will need about $12.5 billion in cash between now and 2018 in order to successfully fund its merger with SolarCity, CNBC reports.
- Tesla CEO Elon Musk has denied it will need to raise capital in the near term, with its most recent equity offering raising $1.5 billion.
- In June, Tesla made an offer for all of SolarCity's stock that values the company at $2.6 billion. Each company's shareholders will vote on the transaction in one month, on Nov. 17.
Dive Insight:
Despite Tesla's recent equity offering of $1.5 billion, the company will likely need much more to fully fund its merger with SolarCity, according to one analyst. According to Oppenheimer's Rusch, Tesla would require up to $8 billion in capital expenses to merge its storage business with the solar installer.
Tesla CEO Elon Musk has denied it will need to raise capital in the near term, tweeting earlier this month: "Would also like to correct expectations that Tesla/SolarCity will need to raise equity or corp debt in Q4. Won't be necessary for either."
The company has moved a surprise product reveal scheduled for today to Wednesday. "Needs a few more days of refinement," Musk tweeted yesterday.
A separate product launch, between Tesla and SolarCity, is planned for Oct. 28 when the companies will unveil a solar roof product along with Powerwall 2.0. On Nov. 1, Tesla intends to provide additional financial detail on its plans to merge with SolarCity.
"These events will create a clear picture of how a combined Tesla and SolarCity will make solar and storage as compelling as electric vehicles – an achievement that would advance our mission of accelerating the world’s transition to sustainable energy," the company said in a blog post.
In September, Musk revealed it was developing a "solar roof" which could be integrated with the Tesla's Powerwall 2.0 battery and a Tesla charger. Also this year, Tesla announced it would be developing a new version of its Powerwall battery that will have a longer lifecycle.
