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Tesla’s proposal to acquire SolarCity has been approved by its shareholders, the company announced on Thursday.
More than 85 percent of shareholders voted to approve the acquisition, according to a Tesla spokesperson.
The deal wasn’t exactly guaranteed to happen. Since Tesla CEO Elon Musk made his offer to buy the solar panel company his cousin Lyndon Rive is the head of for $2.6 billion in stock in August, the deal has been scrutinized by a number of shareholders — seven of whom filed lawsuits against Musk for breaching his fiduciary duty for not disclosing the proposed merger appropriately.
Despite criticism from some of its shareholders, the company decided to move forward with the deal.
“If the Merger is completed, SolarCity stockholders will have the right to receive 0.110 shares of Tesla Common Stock for each share of SolarCity Common Stock issued,” an S4 the company filed with the SEC on Monday read.
Now that the deal has been approved, Musk and his cousins’ — SolarCity CEO Lyndon Rive and CTO Peter Rive — share of the company is valued at somewhere between $700 million and $750 million. (Since it’s an all-stock transaction, they’re not taking money off the table.)
The process to approve the merger was made complicated by an overlap in both executives and board members. Ultimately, Musk and a number of others recused themselves from weighing in on whether SolarCity should sell to Tesla and instead appointed a two-person committee that consisted of CEO of investment management firm Kenmont Solutions Capital Donald Kendall and DBL Partners founder Nancy Pfund.
Taking questions at the @TeslaMotors shareholder meeting approving the @SolarCity merger. @elonmusk pic.twitter.com/mDeeibnuWl
— Steve Jurvetson (@dfjsteve) November 17, 2016
On a number of occasions, Musk pegged the deal as a “no brainer” and argued that consolidating the companies would accelerate the path to sustainably powering everything from Tesla’s vehicles to homes.
“We expect to achieve cost synergies of $150 million in the first full year after closing,” Tesla wrote in a blogpost when the company first announced the proposal. “We also expect to save customers money by lowering hardware costs, reducing installation costs, improving our manufacturing efficiency and reducing our customer acquisition costs. We will also be able to leverage Tesla’s 190-store retail network and international presence to extend our combined reach.”
In an SEC form filed on Oct. 7, Elon Musk initially indicated that the company “is currently planning to raise additional funds by the end of this year, including through potential equity or debt offerings, subject to market conditions and recognizing that Tesla cannot be certain that additional funds would be available to it on favorable terms or at all.”
But he later walked back that statement in a tweet and said neither SolarCity nor Tesla will have to raise equity or debt in either the end of this year or in the first quarter of 2017.
As the day of the vote neared, Musk unveiled a solar roof — perhaps in part to quell skepticism from the public and shareholders.
“We can't do this well if Tesla and SolarCity are different companies, which is why we need to combine and break down the barriers inherent to being separate companies,” Musk wrote. “That they are separate at all, despite similar origins and pursuit of the same overarching goal of sustainable energy, is largely an accident of history.”
This article originally appeared on Recode.net.
