Elon Musk and his cousins — Lyndon Rive and Peter Rive — are purchasing $100 million bonds of beleaguered solar panel company SolarCity.
Musk, SolarCity’s chairman and primary stakeholder, bought $65 million of bonds, while Lyndon Rive, the company’s CEO, and Chief Technology Officer Peter Rive (Lyndon’s brother) are each acquiring $17.5 million, the company said Tuesday in a financial filing.
Musk owns more than 20 percent of the well-weathered company. Lyndon Rive, on the other hand, is SolarCity’s eighth largest shareholder. One of the biggest buyers of the bonds is another Musk company — Space Exploration Technologies Corp.
“Musk is infusing even more of his money,” Nathan Serota, an analyst at Bloomberg New Energy Finance, told reporters Tuesday. “SolarCity is burning through a lot of cash and they need cash.”
He added: “They were hoping to target impact investors,” Serota said. “That hasn’t happened.”
Musk proposed fusing electric vehicle Tesla Motors and solar panel company SolarCity, both of which are headed by Musk.
“This is something that we have been thinking about and debated for many years,” Musk, who recused himself from the vote, said in June following the decision.
The move to meld the two companies has all the earmarks of being a family affair.
Rive, who told reporters he would also be recusing himself from the “decision-making process,” said at the time of the merger that the offer represented a value of between $26.50 and $28.50 a share. “Ultimately, the shareholders will decide,” he added in June.
Kimbal Musk, Elon Musk’s brother, is a director on the Tesla Motors Board of Directors, and had not recused himself from the voting process at the time of the merger, despite the long history he and his brother have building Internet-based companies.
JB Straubel, the co-founder of Tesla Motors, is now on the SolarCity’s Board of Director, and has managed the design of the Tesla’s electric vehicles, focusing on their batteries, motor, power electronics, as well as their software systems. Straubel, despite his entanglement with both companies, has not announced a decision to recuse himself from the voting process.
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