Tesla Says SolarCity Will Contribute About $1 Bln In 2017 Revenue

(RTTNews) - Electric car maker Tesla Motors Inc. (TSLA) said that it expect the acquisition of SolarCity Corp (SCTY) to bring significant financial benefits to the combined company. In fourth-quarter of 2016 alone, it expect SolarCity to add to Tesla's cash position. It also expect SolarCity to immediately account for 40% of the assets of the combined company on a historical cost basis, to contribute over $1 billion in revenue in 2017, and to add more than half a billion dollars in cash to Tesla's balance sheet over the next 3 years.

Nearly one-third of SolarCity's residential bookings in September were purchases, an approximately four-fold increase over the percentage in the first-quarter. As a combined company, Tesla expects this percentage to continue to increase in 2017.

Tesla believes it can realize more than $150 million of direct cost synergies within the first full year after closing. These savings are from sales and marketing efficiencies through cross-selling, the elimination of overlapping R&D and product development efforts, and reduced overhead costs.