WILMINGTON, Del.— Tesla Inc.  Chief Executive Elon Musk was in court Monday to defend the company’s purchase of SolarCity Corp., telling a judge t

Elon Musk Goes On Offensive in Court Defense of Tesla’s SolarCity Purchase

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2021-07-12 21:00:09

WILMINGTON, Del.— Tesla Inc. Chief Executive Elon Musk was in court Monday to defend the company’s purchase of SolarCity Corp., telling a judge that he didn’t act improperly during the negotiating process and doesn’t even enjoy running the electric-vehicle maker.

The case dates to 2016, when Mr. Musk was chairman of both the then-unprofitable companies. His solution to improve their outlook: Combine them in a roughly $2.1 billion tie-up to establish a single clean-energy business. Plaintiffs, which include several pension funds that owned Tesla stock, have characterized the deal as a scheme to benefit himself and bail out a home-solar company on the verge of insolvency.

Mr. Musk was the opening witness called in Delaware Chancery Court in a nonjury trial that is expected to run about two weeks. The attorneys for Mr. Musk have framed the acquisition as an opportunity to realize his long-held goal of creating a vertically integrated sustainable energy company.

A primary question in the case is whether Mr. Musk, who owned roughly 22% of Tesla at the time, controlled the transaction. Proving that claim is a challenge because Mr. Musk was a minority shareholder of Tesla and the company’s shareholders approved the acquisition. Lawyers for Mr. Musk have said that SolarCity was worth more than Tesla paid for it and the electric-vehicle maker’s board members, who included Mr. Musk’s brother, Kimbal Musk, acted independently.

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