Oppenheimer Sees Tesla (TSLA)/SolarCity (SCTY) Merger Delayed, Which Could Work Against the Deal
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Oppenheimer analyst Colin Rusch believes the SEC review process of the pending Tesla Motors (NASDAQ: TSLA)/SolarCity (NASDAQ: SCTY) merger could be delayed due to recent activity, especially new litigation.
Rusch notes the date of record for the shareholder vote is set, but note that adjustments to the S4 have focused on board indemnification, and they expect the recent lawsuit from SunPower and Khosla Ventures to also be included in another amendment.
"We believe extension to the timeline is likely to work against the deal given the risk of ongoing collaboration to trigger gun-jumping rules even with relief from SCTY's immediate financial pressure due to two asset deals and strong TSLA deliveries of 24.5K in 3Q16 (vs. consensus at 22K-23K) supporting bullish arguments," the analyst said.
Shares of Tesla Motors closed at $204.03 yesterday.
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